Photo : Messenger
The country’s money supply in the economy has increased by Tk 6,886 crore in just one month. As the banking sector regulator, Bangladesh Bank (BB) has come up with this revealing information in its latest update as of November last.
The total money in the country's market at the end of November reached 1,889,423 crores, which is 0.37 percent more than the previous month of October. In October last, the money supply in the country's economy was Tk 1,882,536 crore. During October, supplies increased by Tk 5,290 crore, which was Tk 1,196 crore less than the increase observed in November. Investors in the industrial sector are expressing concern due to the reduced supply of money in the economy. Businessmen fear that the declining trend in money supply may create barriers to employment generation.
In this regard, Mohammad Hatim, the executive president of BKMEA, an association of knitwear industry owners, told The Daily Messenger, “There is already a significant shortage of dollars in the country. This scarcity is contributing to the investment crisis. Moreover, after overcoming a disaster like Corona, our business is standing on the edge of the abyss. In such times, we need loans with low interest rates and easy terms. However, the Bangladesh Bank has increased the loan interest rate in the country's banking sector.”
Mohammad Hatim further said, “At this time, the growth of credit in the private sector has fallen below 10 percent. Banks are reluctant to provide us loans due to a liquidity crisis resulting from the government borrowing from banks. In such a situation, we are not receiving gas. Even with the increased price, we are not getting an uninterrupted gas-electricity connection. If this continues, our capacity will decrease, affecting employment and the job market. Every year, between 15 and 18 lakh young people enter the job market, and the private sector must provide jobs for them.”
However, a top official from the Bangladesh Bank said that the supply of money in the market is decreasing due to the high interest of the people’s benefits. Speaking on the condition of anonymity, he told The Daily Messenger, “Inflation control is now the main goal of the Bangladesh Bank. Therefore, the central bank will take whatever measures are necessary. If the money supply in the market increases, inflation cannot be controlled if money is in people's hands.”
The official added, “We reduced the money supply towards the end of last year, and money was withdrawn by selling dollars. We have also ceased lending money to the government. These measures have been taken to control inflation, and the common people are now reaping its benefits. Inflation declined to below 10 percent in October and November compared to September.”
According to the BB data, in November 2023, the central bank provided Tk 148,950 crore, which is 8.56 percent more than November of the previous year. In November 2022, the money supply in the market was Tk 137,940 crore. The central bank attributes the increase in broad money supply in 2023 to a 14.24 percent rise in net domestic assets, amounting to Tk 202,340 crore, compared to the previous year. In contrast, net foreign assets decreased by Tk 53,389 crore or 16.73 percent due to dollar selling.
Messenger/Fameema
