Stocks closed with positive stance after BB’s MPS

Stock markets today closed the session of the week with an upward trend since investors found positive gestures in the new monetary policy statement of the Bangladesh Bank (BB).

The central bank on Sunday announced its monetary policy statement (MPS) for the first half of the fiscal 2023-24 adopting a contractionary monetary policy stance to contain inflation.

The central bank has removed the interest rate cap of 6 percent-9 percent and replaced it with a market-driven reference rate to be regulated by the average treasury bills rate.

As per the new rate formula, stated in the latest monetary policy, the reference rate will be calculated as the six-month moving average rate of treasury bills with a 3 percent margin for banks and a 5 percent margin for non-bank financial institutions.

Currently, the rate of the 6-month treasury bills stands at 7.10 percent, so the maximum lending rate for bank loans will be 10.10 percent and for NBFIs 12.10 percent.

In another move, the central bank will implement a unified and market-driven single exchange rate regime, enabling the exchange rate between the local currency, taka, and USD or any other foreign currency to be determined by market forces. BB will discontinue quoting specific rates for buying or selling foreign exchange, fostering stability in the foreign exchange market.

Dhaka Stock Exchange (DSE) benchmark index DSEX gained 33 points to reach 6,314 and the Chittagong Stock Exchange’s (CSE) all-share price index CASPI surged 80 points to 18,635.

The turnover value of the DSE also rose by 27 percent compared to the previous session and stood at Taka 533 crore.

Out of the total scripts that were traded today, 145 advanced, 29 declined and 178 were unchanged. (BSS)