Bangladesh: Technical Assistance on Developing a Forecasting and Policy Analysis System (FPAS) at the Bangladesh Bank

The Bangladesh Bank (BB), with IMF support, has made significant progress in developing a modern Forecasting and Policy Analysis System (FPAS). During 2021–25, Phase I of the technical assistance (TA) project focused on building staff capacity and establishing core analytical tools, including a Bangladesh-tailored Quarterly Projection Model (QPM), alongside initial steps toward integrating these tools into policy processes. Phase I successfully laid the technical foundations for forward-looking monetary policy analysis. Further progress will require strengthening institutional arrangements to fully embed FPAS into decision-making, including reinforcing the Forecasting Team, implementing regular forecast cycles, and enhancing the use of model-based narratives in policy deliberations and communication.