Monetary Policy Department (MPD), one of the core departments of the State Bank, is responsible to provide candid feedback for monetary and exchange rate management and facilitates the Monetary Policy Committee (MPC) in monetary policy formulation and decision making process. The Department is primarily engaged in the following major activities which include::

• Preparation of Monetary Policy Statement;
• Preparation of dossier/working papers for various Committees; ;
• Making projections for future inflation and economic outlook using Macroeconomic Model and Financial Programming Framework;
• Preparation of Monetary Surveys;
• Preparation of Annual Credit Plan;
• Periodic analysis of monetary and credit developments;
• Contribution to consultations with the IMF;
• Appraisal of world economy and financial developments; and
• Empirical research papers.

The Department has been divided into the following Divisions: :

Monetary Survey Division

The Division is responsible to provide information and objective analysis to the management for prudent policy decisions. The Division is also responsible for the preparation of weekly Monetary Surveys and its allied information; analysis of money & credit trends; identification of issues and concern; assessment of policy developments and provision of input to the internal & external stakeholders. The Division prepares Annual Credit Plan/working papers for NCCC meetings and serves as the NCCC secretariat. It also contributes in providing information and analysis to the MPC and the Monetary Policy Statement.

Policy Formulation Division

The Division provides intellectual, analytical and data support for monetary policy formulation and appraisal, and furnishes working papers and background material for the MPC, Monetary and Fiscal Policies Coordination Board (MFPCB), Economic Coordination Committee (ECC) and Investment Committee meetings, thereby contributing to the efficient conduct of monetary policy and macroeconomic management. The Division also contributes in the preparation of Monetary Policy Statement taking into account global and regional policy initiatives..

Macro Modeling Division

The Division has been assigned the responsibility to make predictive assessment regarding inflation and future outlook of the economy. The Division is engaged in the following prime activities.

• To make forecast for major economic indicators and to provide an independent assessment of the future outlook of the economy, Quarterly, and Annual Reports,
• To make forecast for major economic indicators on monthly basis as an input for policy decisions, and
• The quarterly updation of the medium-term forecast (current plus three years ahead) based on Financial Programming

Annual Credit Plan FY 07

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