BB keeps policy rate unchanged 

The Bangladesh Bank has kept its policy rate unchanged for the second half of the year, as it continues efforts to rein in inflation.

In its monetary policy statement today, the central bank said the 10 percent policy rate would remain in place for the July-December period.

Although monthly inflation eased to 8.48 percent in June, the lowest since February 2023, the annual average stood at 10.03 percent at the end of June for the recently-concluded fiscal year 2024–25.

That marks the highest level since at least FY 2013, up from 9.73 percent a year earlier.

The central bank has raised the policy or repo rate, the rate at which it lends to commercial banks, 11 times since May 2022.

It lifted the rate to 10 percent in October last year and has maintained a hawkish stance, as inflation stayed above 9 percent for more than two years until May.

While presenting the monetary policy, BB said that given the current situation and ongoing global risks, it would maintain its tight monetary stance in the first half of the fiscal year 2025-26 to curb inflation and stabilise inflation expectations.

"If the inflation rate continues to decelerate further, as we expect, the policy repo rate may be adjusted downward," said the central bank.

According to BB, until the inflation rate comes below 7 percent, the policy repo rate will remain unchanged at 10 percent. Besides, the Standing Lending Facility (SLF) rate will remain at 11.5 percent, and the Standing Deposit Facility (SDF) rate will be 8.0 percent.