The Bangladesh Bank has announced the monetary policy for the final six months (January–June) of the 2025-26 fiscal year. In this latest policy statement, the primary policy interest rate has been kept unchanged.
On Monday (February 9), Central Bank Governor Dr. Ahsan H. Mansur unveiled the policy during a press conference held at the bank’s headquarters.
Key Economic Observations
During the announcement, the Governor highlighted several critical trends in the financial sector:
Private Sector Credit: Credit growth in the private sector has fallen below expectations, which the Governor attributed to political instability and a lack of confidence.
Government Borrowing: Despite budget cuts, government borrowing from the banking sector has increased.
IMF Compliance: The Governor confirmed that Bangladesh Bank has met all conditions set by the International Monetary Fund (IMF).
Reserves and Dollar Management: Approximately $4 billion has been purchased from the market over the past year. Notably, the Governor stated that no dollars were sold from the national reserves during this period.
Remittance Growth: Remittance inflows have grown by over 18%, with projections suggesting total remittances could reach $35 billion this fiscal year.
Adjustments to the Interest Rate Corridor
While the main policy rate remains steady, the central bank has adjusted the Interest Rate Corridor (IRC) to encourage banks to lend to the private sector rather than "parking" excess cash at the central bank.
| Rate Type | Status | New Rate |
| Policy Rate (Overnight Repo) | Unchanged | 10.00% |
| Standing Lending Facility (Upper Ceiling) | Unchanged | 11.50% |
| Standing Deposit Facility (Lower Floor) | Reduced | 7.50% (previously 8.00%) |
Rationale: Bangladesh Bank noted that some banks were preferring to deposit surplus liquidity with the central bank instead of engaging in the interbank market or lending to the private sector.
To discourage this and boost market dynamism, the floor rate (SDF) was slashed by 50 basis points.
These changes are set to take effect from February 15.
