The new monetary policy for the fiscal year 2024-25 will be announced by the end of July. This year’s monetary policy can also be adopted to reduce the flow of money in the market or to adopt a contractionary policy according to the conditions of the IMF. If this is the case, contractionary monetary policy will be followed for three consecutive years with the aim of reducing the rise in inflation. As it has hindered new investment and employment in the country in the past, so will the same situation in the future. As a result of this policy, inflation did not decrease, on the contrary, it increased. Meanwhile, contractionary policies are having the biggest negative impact on the private sector and the labor market. In this context, the officials of the central bank are in a quandary while preparing the monetary policy framework for the next financial year. However, this time the flow of money will be reduced, but the supply of money in the production sector will be increased. So that investment increases.

According to sources, the new monetary policy for the July-December period of the next financial year will be announced at the end of July. The central bank is working on this. However, the central bank is proceeding very cautiously while formulating the monetary policy this year. Controlling inflation and keeping the exchange rate stable is one of the fundamental responsibilities of the central bank. But for the past two years, the central bank has been failing to fulfill these two responsibilities. When the Russia-Ukraine war started in February 2022, the dollar price in the country increased sharply due to the impact of the global recession. A maximum of 52 percent devaluation of rupees has occurred in the last two years. Further devaluation is expected in the coming days as well. Inflation has risen from 6.5 percent to close to double digits. Inflation has been above 9 percent for 14 months. Inflation in food has exceeded 12 percent. This has increased the suffering of low and middle income people in particular. Their living expenses have become difficult now.

To control the situation, the central bank has adopted a policy of reducing the flow of money from the financial year 2022-23 to the current financial year. Through this, the loan interest rate has increased. The value of the dollar has increased. Due to this, the product price has increased. Investment did not increase. As a result, the employment rate did not increase. Rather, many have been fired from previous employment. Those who are working, their income has also decreased. As a result people’s suffering increased. In such a situation, the monetary policy of the next financial year has come forward. The IMF’s main condition is to adopt a policy of reducing money flows until inflation is brought under control. Due to this, the flow of money will be reduced in the next monetary policy. However, the flow of money will be increased especially in the manufacturing sector. The central bank will pay special attention to keep the interest rate low in this sector.

Meanwhile, the central bank has always been saying that the current inflation is not due to increased money flow. Now the flow of money is not increasing. Fiscal policy and monetary policy are also coordinated. Due to which the income-expenditure balance of the government has come. Still inflation is rising. They pointed to the error in market management and said that due to the error in the market, the price of the product is increasing. Due to which the rate of inflation is increasing. But the IMF is not talking about market mismanagement. They emphasized the use of monetary policy to control inflation. Now it is not possible to accept the policy of increasing money flow beyond their conditions. Because, it can block the money of the fourth installment of the loan.