The Bangladesh Bank (BB) governor is optimistic about achieving a moderate growth this fiscal rate in the current fiscal.

He said enhancement of credit flow to small and medium enterprises (SMEs), the central bank’s intervention in the currency market through release of dollar and its transparent and accountable monetary policy and disbursement of soft term credit in the Sidr- affected areas to keep macro-economic stability after the recurrent floods and cyclone would help gain such growth.

“As a result, we are hopeful the projected GDP growth rate between 6.2 to 6.5 percentage for the 2007-08 fiscal is achievable,” Dr Salehuddin Ahmed told a press briefing at the central bank’s conference room yesterday.

Salehudin said the central bank has already asked all scheduled banks not to realise both principal amount and interest for at least three months from the borrowers in the Sidr-hit areas.

“Rather, the central bank gave the directives to the public and private commercial banks, NGOs and other non-banking financial institutions (NBFIs) operating in the Sidr-affected areas to re-schedule their loans and provide new loans to the farmers,” the BB chief said.

He said the amount of excess liquidity in the banking system declined to Tk 110 billion from Tk 140 billion due to borrowing money by the private sector investors over the last few months.

He said the central bank has released an amount of 184 million US dollars in the last few months to ease the domestic currency market.

Defending his opinion on a moderate growth rate, the central bank governor said the foreign currency reserve in October has increased by 5.7 percent and currency supply by 14.2 percent compared with the corresponding period of the last fiscal.

During the period, the domestic lending rate and contribution of private banks in providing loans increased by 13.4 percent and 16.3 percent respectively, he said.

Pointing to a remarkable progress in remittance earning, Salehuddin said up to December 18, the amount of foreign currency reserve stood at $5396.3 million compared with the $3762.5 million reserve in the corresponding period of the last year.

The remittance was $618.6 million as of November, which was $598.73 million in the corresponding period of the last year, he said.

The BB governor said the average inflation rate in the 2007-08 fiscal will remain between 8.1 to 8.5 percent, although the average and point-to-point inflation rates ranged from 8.25 percent to 10.06 percent in October on higher import costs of food products and fuel oil from the international markets.

He said the import cost in the 2007-08 fiscal increased by 18.1 percent from its previous 17.8 percent due to higher import of food and capital machinery during this period.

The BB governor also asked the scheduled banks to launch new banking products for the small-scale fishermen and other marginal level people in the Sidr affected areas for their better survival.