Economy to grow by 6.3pc in current FY- IMF

The Bangladesh economy will grow by 6.3 percent in the current financial year to end-June, the International Monetary Fund said on Monday, lower than the government target of 7 percent.

IMF said Bangladesh’s growth is projected to accelerate gradually to 7 percent over the medium term, as public investment is further ramped up and constraints on investment ease, blue economywith private investment also supporting a recovery in private-sector credit.

“Provided calm prevails, prudent policies remain in place, and structural reforms are implemented as envisaged, the medium-term economic outlook should be positive and marked by continued stability and high growth,” IMF said after a midterm review.

Inflation is forecast to remain broadly stable in the current financial year and edge up slightly next fiscal year, due to temporary effects from higher public sector wages and the introduction of new VAT.

“Growth has been robust, external reserves have risen, inflation has abated, and social indicators have improved,” it said.

With inflation risks tilted to the upside, IMF recommended continued vigilance and prudent adjustment of the reserve money growth.

It also encouraged the Bangladesh authorities to continue sterilized foreign exchange intervention and consider adopting a basket of trading partners’ currencies to guide foreign exchange intervention policy going forward.

– Reuters