Central bank suggests actions to tame soaring inflation
Thursday, 9 August 2007
Shakhawat Hossain
The Bangladesh Bank has put forward about half a dozen recommendations, including improvement of revenue generation, to check inflation that has almost soared to double-digit mark, official source said.
The central bank has also requested the government to adopt appropriate measures for integrating its monetary, revenue and trade policies and reducing borrowing from the banking sources to check the rising inflation.
It suggested the Ministry of Finance (MoF) to take timely actions following the recommendations against the backdrop of rising inflation, which was recorded at 9.2 per cent on point-to-point basis in June last, source added.
"The inflation in June is all time high in a decade, which is posing a threat to the country's macro-economic stability," said a senior MoF official.
With the steep rise in prices of food items and countrywide floods, the MoF and other concerned officials expressed their fear that the inflation may cross the double-digit mark.
According to available statistics, the government borrowed Tk 9.61 billion from the banking sources in the period between July 1 and July 24 last, representing almost 100 per cent increase over that of the same period of the corresponding fiscal.
The central bank has suggested the MoF to reduce its dependence on the bank borrowing by improving performance of the revenue board, the official added.
The Bangladesh Bank advised the government to ensure sufficient credit flow to the country's manufacturing sector.
The central bank has recommended the government to boost its efforts in marketing of agricultural products to bring down the food prices.
It also recommended the government to beef up the supply of food products through necessary imports.
The government has approved an import of 50,000 tonnes of rice from a neighbouring country to bring down the prices of the item in the local market.
The Bangladesh Bank has put forward about half a dozen recommendations, including improvement of revenue generation, to check inflation that has almost soared to double-digit mark, official source said.
The central bank has also requested the government to adopt appropriate measures for integrating its monetary, revenue and trade policies and reducing borrowing from the banking sources to check the rising inflation.
It suggested the Ministry of Finance (MoF) to take timely actions following the recommendations against the backdrop of rising inflation, which was recorded at 9.2 per cent on point-to-point basis in June last, source added.
"The inflation in June is all time high in a decade, which is posing a threat to the country's macro-economic stability," said a senior MoF official.
With the steep rise in prices of food items and countrywide floods, the MoF and other concerned officials expressed their fear that the inflation may cross the double-digit mark.
According to available statistics, the government borrowed Tk 9.61 billion from the banking sources in the period between July 1 and July 24 last, representing almost 100 per cent increase over that of the same period of the corresponding fiscal.
The central bank has suggested the MoF to reduce its dependence on the bank borrowing by improving performance of the revenue board, the official added.
The Bangladesh Bank advised the government to ensure sufficient credit flow to the country's manufacturing sector.
The central bank has recommended the government to boost its efforts in marketing of agricultural products to bring down the food prices.
It also recommended the government to beef up the supply of food products through necessary imports.
The government has approved an import of 50,000 tonnes of rice from a neighbouring country to bring down the prices of the item in the local market.