DHAKA, Nov 26, 2023 (BSS) - Bangladesh Bank (BB) has increased the policy rate, also known as repo rate, by 50 basis points to 7.75 percent to contain inflation. 

The new rate will be effective from tomorrow, said a BB press release issued today.

The monetary policy committee of the central bank decided to raise the policy rate at a meeting at the central bank headquarters in the capital. 

The repo rate is the rate at which the BB lends money to commercial banks or financial institutions.

As per the decision, the highest ceiling of policy rate corridor of standing lending facility (SLF) rate has been raised to 9.75 per cent from 9.25 per cent while the lowest limit of standing deposit facility (SDF) rate has been raised to 5.75 per cent from 5.25 per cent.

The reference lending rate, also known as SMART (six-month moving average rate of Treasury bill), has been surged by 25 basis points for all sectors.

Earlier in October 4, the central bank, in its monetary policy statement, raised repurchase agreement (repo) rate to 7.25 per cent from 6.50 per cent to control inflation and regulate the overall interest rate environment.