The government has set a target to limit inflation within 6.5 per cent in the financial year 2024鈥�25, although prices of food and non-food items keep rising over the year.
Finance minister Abul Hassan Mahmood Ali in his budget speech on Thursday said that the government expected the inflation to come down to 6.5 per cent in the next fiscal year as an outcome of the adoption of some policy strategies.
An economist, however, expressed doubt about the achievability of the target.
The finance minister said that Bangladesh had already undertaken a contractionary monetary policy in line with the steps taken by other countries to curb inflation,聽 while the interest rate had been significantly increased.
Different steps were being adopted for the success of the monetary policy, he said.聽
At the same time, supportive policies were also under implementation in the fiscal sector, Abul Hassan mentioned.
鈥楪overnment support like 鈥渇amily card鈥� and 鈥渙pen market sale鈥� programmes are being strengthened to protect the common people from adversities arising from high inflation,鈥� he said.
The finance minister further said that although disruption in the supply chain in the domestic market was the main reason for spiralling inflation, the other reason was the devaluation of taka against foreign currency.
Taka was devalued approximately by 25.5 per cent against dollar and the devaluation increased the prices of imported goods which had an impact on the overall inflation of the country, he explained.
However, think tank Research and Policy Integration for Development鈥檚 chair Mohammad Abdur Razzaque thinks that the target is likely to be missed.
鈥業 think it won鈥檛 be possible for the government to meet the inflation reduction target which has been set in the proposed budget, mainly due to the dollar crisis,鈥� Abdur Razzaque told 抖阴精品 on Thursday.
He mentioned that further devaluation of the taka might occur at any time due to the ongoing dollar shortage.
鈥楾he crisis has led the government to control imports, indicating that there is no opportunity to improve the supply situation to reduce inflation,鈥� Razzaque said.
In the ongoing FY24 the government鈥檚 target was to keep inflation limited to 6 per cent.
According to the Bangladesh Bureau of Statistics, inflation rose to 9.89 per cent in May as the prices of both food and non-food items continued to rise.
