The New Nation - Internet Edition

UNB, Dhaka

Bangladesh Bank would keep maintaining growth in private sector credit by any means to help people face the inflationary pressure through creating employments.

Governor Dr Salehuddin Ahmed yesterday declared the central bank's stance against "contractionary" monetary policy as a strategy to maintain macroeconomic stability as well as growth.

"The major target is to contain inflation through a pragmatic policy, which you can call it a kind of 'hybrid' policy," he told a luncheon meeting of France-Bangladesh Chamber of Commerce and Industry (CCIFB) at a city hotel.

The Governor indicated a blend of policy that would enable credit growth and at the same time keeping a close watch on the money supply so it does not put pressure on the inflation.

"Credit has to be there…we cannot have a tight monetary policy as we need to create huge employment opportunities," he said, replying to a question.

He also replied to a question whether the lending rate was reduced, saying, "It's not true that it's not working. We're trying not to allow the interest rate spread cross the 5 percent level."

He was unwilling to make public the central bank's policy instruments to put pressure on the lending rates, but said they were trying to reduce the lending rate through moral pressure.