Dhaka, June 30 -- The latest Monetary Policy Statement (MPS) has rightly recognised that inflation in Bangladesh remains largely driven by supply-side constraints, making the decision to keep the policy rate unchanged at 10 per cent a prudent one, according to M Mashrur Reaz, chairman and chief executive officer of Policy Exchange Bangladesh.

Speaking with The FE on the newly announced monetary policy, Reaz said the central bank's acknowledgement that inflation is primarily supply-driven is one of the statement's most significant features.

"Despite recognising that supply-side factors remain the primary driver of inflation, Bangladesh Bank has decided to keep the policy rate unchanged at 10 per cent. I believe this is a prudent decision...