BB growth forecast lags govt’s target

Bangladesh Bank has projected the country’s economy to expand by 6.1 per cent in FY2026-27, below the government’s 6.5 per cent growth target set in the national budget, while keeping its key policy interest rates unchanged as it continues efforts to contain inflation.

The forecast was outlined in the central bank’s Monetary Policy Statement (MPS) for the July-December period of FY2026-27, released on Tuesday (30 June).

According to provisional estimates from the Bangladesh Bureau of Statistics (BBS), the economy grew by 4.14 per cent in FY2025-26, recovering from 3.49 per cent in the previous fiscal year.

The MPS said the government’s fiscal stance for FY2026-27 seeks to strike a balance between supporting economic growth and maintaining fiscal discipline, with an emphasis on development spending, tax reforms, expenditure rationalisation, targeted subsidies and expanded social protection programmes.

“The new government has enacted growth-supportive but fiscally prudent expansion focused on development expenditure as its fiscal stance for FY27,” the statement said.

The central bank noted that the government has adopted a broader economic strategy aimed at restoring macroeconomic stability and advancing structural reforms to lay the foundation for investment-led growth.

As outlined in the FY2026-27 budget, the first phase of the government’s 3R Strategy — Recovery and Stabilisation, Restoration and Reconstruction for Acceleration — will focus over the coming year on stabilising the economy while shielding vulnerable groups from the effects of economic shocks.

The strategy also places priority on strengthening social protection programmes, improving public service delivery, streamlining business procedures and enhancing coordination across public institutions.

Meanwhile, Bangladesh Bank kept all key policy rates unchanged. The policy repo rate remains at 10 per cent, the Standing Lending Facility (SLF) rate at 11.5 per cent, and the Standing Deposit Facility (SDF) rate at 7.5 per cent.