BB to include outside experts in monetary policy committee

The Bangladesh Bank (BB) has decided to include outside experts to formulate a new monetary policy to make the economy vibrant and tame the growing inflation.

Dr Md Ezazul Islam, executive director of the Monetary Policy Department, told UNB on Monday that earlier only central bank officials were members of this committee, but a decision has been taken to include three more people from outside.

This decision was taken at a meeting of the Bangladesh Bank's Board of Directors on Sunday.

The country is going through an economic crisis now. Inflation is close to 10 percent. The rate of food inflation is over 12 per cent. Amid this crisis, the Monetary Policy Committee of the central bank was reconstituted to deal with the situation.

Ezazul Islam said that the monetary policy formulation committee will have the deputy governor, chief economist, and executive director of the monetary policy department along with the governor of the central bank.

From outside of the BB, the chairman of the economics department of Dhaka University and the director general of the Bangladesh Institute of Development Studies (BIDS) will be included in the committee.

In addition to them, the board of directors of the BB has agreed to keep Dr Sadiq Ahmed, the vice chairman of the research institute Policy Research Institute (PRI), or Dr Zahid Hussain, an economist of the Asian Development Bank (ADB), in the committee.

The BB sources said that whoever is found available among these two will be invited to the monetary policy formulation committee meeting.

Economist Dr Ahsan H Mansur told UNB that the central bank's main task is to solve the economic crisis and the main tool of the central bank to control inflation is the effective use of monetary policy.

Inflation is usually managed by controlling the money supply in the market by raising or lowering interest rates.

“This work is done by the monetary policy department of the Bangladesh Bank. It is one of the most important departments of the central bank of every country. Monetary policy is less used as a tool to control inflation in Bangladesh,” he said.