Eminent economist and Policy Research Institute (PRI) Executive Director Ahsan H Mansur has advised Bangladesh Bank (BB) to take initiatives to tame inflation first and bringing stability in the country’s economy.
The former IMF official also opined that the USD market will stabilise if the inflation rate is reduced. He gave the suggestions to BB during a meeting at the central bank in Dhaka on Wednesday.
According to the Bangladesh Bureau of Statistics (BBS), the inflation rate was in a downtrend in the first two months (June and July) of FY2023-24. However, it went up again in August to 9.92 per cent.
At that time, food inflation was at 12.54 per cent, which was highest in the last decade.
After the meeting, BB Executive Director and spokesperson Mezbaul Haque said that inflation, exchange rate volatility and defaulted loans are the biggest challenges at the moment. That’s why the PRI executive director suggested reducing inflation first and then also emphasised not lending to the government by printing money.
Mezbaul said that during the discussion, BB told Ahsan that the government has reduced expenditure in various sectors, including land acquisition. So now there is no need to take money from the central bank.
As a result, the government is no longer taking loans from BB. However, if necessary, the government can now take loans from commercial banks, he said.
On September 21, BB Governor Abdur Rouf Talukder had a meeting with the former caretaker government economic adviser Wahiduddin Mahmud, during which the latter also suggested stopping lending to the government by printing new money.
Mezbaul added that BB will continue to sit with other economists, chambers, the Economic Reporters’ Forum, and other sectorial people in future.
On Wednesday, the governor also held another meeting with observers in various banks. He gave strict instructions to the observers to ensure good governance in the sector and assured that there would be no laxity on the part of BB to ensure good governance.
