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CBM Considers Easing Interest Rates Until Banks Can Set Their Own

canlender17/09/2019

Author: Zin Thu Tun : The Central Bank of Myanmar (CBM) is considering whether or not to ease the rules for setting interest rates until private banks can set their own, said U Soe Min, Deputy Governor of the Central Bank of Myanmar, at the Pyidaungsu Hluttaw, the country’s highest legislature.

The central bank is very cautiously handling interest rates, but he said: “In the future, the Central Bank of Myanmar will only set a policy on interest rates, and let banks set their own interest rates on their needs.” This was an explanation he gave during a report on policy implementation and financial stability of the country.

“We cannot make big changes to the interest rate at once. We also need to look at the money market when considering making changes to lower or increase the interest rate. Without considering important factors, any moves to lowering or increase the rate will either have no impact, or lead to an undesirable outcome. So, we need to take time,” he said.

The Central Bank of Myanmar will seek help from the International Monetary Fund and look at what other countries have done before easing the policy on interest rates.

There are currently a total of 21 private banks with 1,844 branches across the country.