Bangladesh Bank keeps policy rate unchanged in its first ever quarterly monetary policy

Bangladesh Bank (BB) has kept the policy rate unchanged at 9.5 percent for the October-December period of this year, announcing the first-ever monetary policy on a quarterly basis, moving away from the six-month cycle.

Announcing the rate today, the central bank said although inflation eased to 8.26 percent in August 2026 from 9.16 percent in June, underlying inflationary risks persist alongside subdued economic activity. 

Tap here to add The Daily Star as a trusted source

The BB, explaining the rationale for maintaining the policy rate the same, said inflation remains vulnerable to supply and cost pressures, particularly from high and volatile global energy prices amid the prolonged Middle East conflict and disruptions in the Strait of Hormuz, the recent upward adjustment of administered fuel prices, and the potential impact of national pay scale implementation. 

“At the same time, economic growth remains under stress, reflected in weak industrial production, slow private sector credit expansion, and a depressed Purchasing Managers' Index,” it added.

“The central policy challenge is to support economic activity without compromising the disinflation process,” it said, adding that the Monetary Policy Committee (MPC) will closely monitor global and domestic macro-financial developments and calibrate monetary policy stance as necessary.  

The BB decided to keep the Standing Lending Facility (SLF)-- the interest rate at which commercial banks can borrow money overnight from the central bank -- at 11 percent and the Standing Deposit Facility (SDF) at 7.50 percent. 

SDF is the interest rate at which commercial banks can deposit excess funds overnight with the central bank to earn interest.