Staff Reporter :Bangladesh Bank (BB) on Tuesday unveiled the Monetary Policy Statement (MPS) for the first half of the current fiscal, projecting a higher credit growth to the private sector as a move to boost investment for supporting inclusive economic growth.BB Governor Fazle Kabir unveiled the MPS for the July-December of the fiscal year (2016-17) at a press conference held at the central bank headquarters in the capital. “The nature of the new monetary policy is “cautiously accommodative” and it has been formulated to achieve maximum economic growth through boosting credit to the private sector,” said Governor Fazle Kabir while announcing the MPS. He believed that the MPS will support and advance the momentum of inclusive, equitable and environmentally sustainable growth, further consolidating inflation moderation and macroeconomic stability. “The new monetary policy will ensure adequate liquidity supply in the financial system so that banks can lend the productive sectors to support economic growth and employment generation,” said Fazle Kabir.The BB increased the private-sector credit-growth target substantially for the current fiscal in consideration of the country’s overall situation. Private sector credit growth is projected to grow by 16.5 per cent by the end of the fiscal year (FY) 2016-17, compared with 14.8 per cent of the fiscal year 2015-16. But it has been estimated at 16.6 per cent for the first half of the fiscal year 2016-17.”The private sector credit growth is expected to go beyond the set target, as demands for such credit is on the rise,” said the BB Governor.He added that the central bank would revise the credit target in December considering its demand. Private sector credit grew by 16.4 per cent as of May this year, whereas the target up to June was 14.8 per cent in the last monetary policy.”The main objective of the monetary policy is moderation and stabilization of CPI inflation alongside supporting output and employment growth,” the BB said in its MPS. BB’s monetary and financial policies will continue supporting inclusive, environmentally sustainable growth; addressing its developmental role in the longer term risks to macro-financial stability, it added.Earlier, the government has set the GDP growth target for the current fiscal year at 7.2 per cent and inflation within 5.8 per cent.In the last MPS, BB projected GDP growth rate at 6.8 to 6.9 per cent and inflation at 6.2 per cent for FY16, ending in June 30.
