Bangladesh Bank (BB) on Wednesday postponed a crucial meeting of its Monetary Policy Committee (MPC) following the resignation of noted economist Dr. Sadiq Ahmed from the committee.

The meeting, chaired by the newly appointed Governor, Md. Mostaqur Rahman was widely expected to announce a reduction in the policy interest rate to ease lending costs for businesses.

Dr. Sadiq Ahmed, Vice Chairman of the Policy Research Institute (PRI) and a former senior official of the World Bank, reportedly submitted his resignation today. He was the only member of the seven-member MPC nominated by the central bank's board of directors.

While the central bank did not provide an official reason for the postponement, sources within the bank suggested the decision was linked to the sudden vacancy in the committee and ongoing debates over lowering interest rates amid persistent high inflation.

"We were informed on Tuesday afternoon that the meeting would not take place. It may now be held after the upcoming Eid holidays," said Dr. AK Enamul Haque, Director General of the Bangladesh Development Research Institute (BIDS) and an MPC member.

The new Governor, who recently took charge, had signaled an initiative to reduce the policy rate—currently at 10 percent—by 25 to 50 basis points. The move aimed to lower the cost of borrowing to stimulate investment, a shift from the tight monetary stance maintained by the previous administration to curb inflation.

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However, economists and some committee members expressed concerns that premature easing could aggravate inflationary pressures, which remain above 8 percent.

The seven-member MPC is headed by Governor Md. Mostaqur Rahman. Other members include Deputy Governor Md. Habibur Rahman, Chief Economist, Md. Akhtar Hossain, BIDS DG AK Enamul Haque, Dhaka University Economics Department Chair, Ferdousi Nahar, and BB Executive Director Mahmud Salahuddin Naser.