According to Central Bank sources, the repo (borrowing from Bangladesh Bank by depositing treasury bills) interest rate may be increased from 10 percent to 10.50 percent. Even if the policy rate rises, the interest rate (4 percent) on loans to government officials and bankers will remain unchanged. Last Sunday, Bangladesh Bank Governor Dr. Ahsan H. Mansur started discussions on the monetary policy announcement for the second half of the current fiscal year. In the meeting, he said that the policy interest rate will be increased if inflation does not decrease. This will be the first monetary policy announcement by the current governor.

Bangladesh Bank lends to banks against repo. Money is withdrawn from commercial banks through reverse repo. Again, the bank rate is also a type of policy interest rate. Government officials and employees, judicial service, Bangladesh Bank, government banks and financial institutions usually get loans at the bank rate. Therefore, if the bank rate increases or decreases, the loan costs of employees of these institutions increase or decrease.

From 2003 to 2020, the bank rate was 5 percent. In July 2020, a directive was issued to reduce the bank rate to 4 percent. On July 30 of that year, the repo rate was reduced to 4.75 percent and the reverse repo rate was set at 4 percent. To keep pace with this, the bank rate was reduced by 100 basis points to 4 percent.