Bangladesh Economic Update January 2014
The present issue of the Bangladesh Economic Update focuses on the currently announced half-yearly Monetary Policy Statement (MPS) for the period of January-June of FY 2013-14, by the central Bank, Bangladesh Bank (BB). The Update examines the current MPS in the background of falling growth in private sector credit, which leads to lower investment demand, resulting in lower economic growth in the country for the last three years in a row. In addition, the Update explicates the issue of rising inflationary pressure in the economy as well as implications on the common people.
The rate of growth of actual disbursement of credit to the private sector in July to September, 2013-14 over July to September, 2012-13 were 10.18 percent, representing a 5.32 percentage point gap.
At the same time, the overall inflation increased (7.35 percent)0.2 percentage point in December 2013 (point to point basis)from 7.15 percent in November 2013, meaning the monetary policy has yet to be proved to be successful in keeping inflation at targeted level which was 6.0- 6.5 percent (base year 2005-06).