 [ Trade & Market ] 2012-05-17 |
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Govt borrowing level in BD remains moderate: Atiur |
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Government borrowing level in Bangladesh remains moderate, rarely exceeding four per cent of GDP, Bangladesh Bank Governor Atiur Rahman said.
"However, the government's borrowing from the banking system creates spells of liquidity crunch in the inter-bank market needing market intervention by the central bank," The BB governor said while addressing the 'SAARCFINANCE roundtable on Macro-prudential and Monetary Policies and SAARC Region' in Pokhra, Nepal Wednesday.
The governor also said that the CPI inflation is also on downtrend but still in double digits from knock on effects of energy price hikes. With the prevailing subdued trends in global commodity prices, we expect CPI inflation in Bangladesh to decline further in the coming months.
Dr. Atiur Rahman proposed the SAARC leaders to establish a useful forum for exchange of ideas and experience on monetary policies for financial stability. The SAARCFINANCE forum can be a convenient regional consultation and cooperation platform on measures bolstering financial stability and promoting financial development in the region. It can also serve as coordination of fiscal monetary policy stances and external spillovers from macroeconomic policies among member countries.
The BB governor said that macro-prudential reforms in the SAARC region are proceeding along lines of these global developments; in phased manner best suited to the stage of financial market development in each country. Apart from being important for price stability, monetary policies matter also for financial stability.
During the global financial crisis and its attendant global growth slowdown monetary policies in all South Asian economies understandably adopted accommodative stance to uphold domestic demand and output activities in the backdrop of sagging external demand, he added. |
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