Dhaka, Bangladesh (BBN) – The central bank of Bangladesh raised the cash reserve requirement (CRR) by 0.5 percentage points to 6.0 percent for the commercial banks on Wednesday to curb inflationary pressure on the economy.
“We’ve increased the CRR to curb inflationary pressure on the economy,” General Manager of the Monetary Policy Department of Bangladesh Bank (BB) Begum Sultana Razia said, adding told the central bank has taken the latest move considering the country’s overall economic situation.
Under the new rules, the commercial banks will have to maintain 6.0 per cent CRR with the central bank from their total demand and time liabilities on a bi-weekly basis.
The new CRR will be effective from December 15 this year, another BB official said, adding that the central bank issued a circular in this connection on Wednesday.
The banks will be allowed to maintain the reserve at 5.50 per cent instead of the existing 5.0 per cent on daily basis, but the bi-weekly average has to be 6.0 per cent in the end, according to the new rules.
The new CRR comes after a gap of more than six months. The central bank last increased the ratio by 0.5 percentage points to 5.50 percent on May 5 this year.
The central bank has also increased the rate of statutory liquidity ratio (SLR) to 19 percent from the existing 18.50 percent, which will come into effect from December 15 this year, the central bank officials said.
The central bank expects that the inflationary pressures might ease in the coming months following the latest policy intervention, the BB officials added.
BBN/SI/AD-01Dec10-9:35 pm (BST)