Increasing Interest Rate To Control Inflation, Is That A Solution?

Recently the the financial news published in our local newspaper and at first the decision of increasing interest rate were taken by central bank of Bangladesh. They have valid reason and that's Ukraine-Russia ongoing war and the war affected the supply chain. We are still having issues like inflations and others. I'm not a financial expert but people whoever works in this field surely taken the decision for something good. If increasing interest rate can solve the problem of inflation then the decision should be appropriate. Price of each products increasing day by day and that affecting the life of common people financially .

According to the information the interest rate increased 5.5% to 5.75% and they believe this can control the inflation. It already effective from October 2 and I'm waiting for their next update about this issue, if it works or not. Like Bangladesh Bank does international banks take such decision to fix inflation issues? There are many questions are appearing on my mind and I may find the answer later.

According to the announcement of Bangladesh Bank, we recovered the loss of covid-19 but still there is some imbalance between supply and global demand and they think Ukraine-Russia war made things worsen and it will take time to recover the financial issues. For this war most price has increased of commodities in global market since the beginning of 2021. And it still going on though financial experts taking wise decisions to fix the issue.

Our Bangladesh Bank also mention that they are following the world's economic country US also increased the interest rate to control inflation so they have valid reason behind increasing interest rate as they are applying strategies of world's best economic country. Financial experts also warning about a big financial trouble for this Ukraine-Russia war. We common people suffering all year long as each and every product price has increased. If this increase rate of interest can fix the problem of inflation then it will be surely a wise decision.

Salary not increasing of common people but the food they eat daily is available in high price. If this continuous for long time then our finance can be affected badly which we do not expect. Thankfully we are not alone in this financial battle, the whole world is experiencing the same but as under developed country we are suffering more than others. Financial stability is a great strength of a country and it never can be possible over a night, it surely takes time but having wise decision is also important to quick recovery.

Financial loses are like natural disasters which takes time to be stable. Its good that our banks are following the foot steps of high ranked financial countries. Hopefully the strategy will work for under developed country too. A good research is important before taking any financial decision. Our economy shouldn't affected by any unwise decision and that is my concern. What do you think about it?