Inflation & Revenue Strategies - Bangladesh’s Economic Pulse

• Govt Plans Major Revenue Boost of BDT 6,155bn in revenue for Upcoming Fiscal Years through Extensive Reforms Source

• Private Credit Growth Hits Three-Year Low - 9.20% Due to High Inflation and Lending Caution Source

• WB Cuts FY25 Growth Forecast to 4%, due to financial sector reforms and Liquidity Challenges Source

• Food Inflation Surges to 12.66% in October, contributing to an overall inflation rate of 10.87% Source

• Foreign Exchange Reserves crossed USD 20bn in October but face downward pressure from pending payments Source

• NBR Links Tax Filing to More Services which will connect tax return submission to 43 services to expand the tax net Source

• A draft law mandates a separation between conventional and Islamic banking operations for banks Source

• World Bank to Guarantee Energy Payments to imports and provide budget assistance by year-end Source

• Garment Exports to the US Decline by 6.29% in January-September 2024 Source

• Tea Exports Hit Seven-Year High driven by competitive pricing in global markets Source

• Bangladesh’s PMI Rises to 55.7 in October, Signaling Economic Recovery Source

• Gold prices dropped by BDT 3,452 per bhori following a decline in local market rates. Source

Economy

• Food Inflation Hits 12.66% in October: Food prices surged to 12.66%, pushing total inflation to 10.87%. The rise is attributed to supply and demand constraints, with calls for import tariff cuts to stabilize prices Source

• Govt Eyes Revenue Expansion: The government has set ambitious targets to raise BDT 6,155bn in revenue over the next two fiscal years, with extensive fiscal reforms aiming for a 13% annual growth through FY27 Source

• Forex Reserves Surpass USD 20bn: Foreign exchange reserves crossed USD 20bn due to increased remittance inflows, although a significant payment to the Asian Clearing Union may impact this stability Source

• Bangladesh’s PMI Rebounds: The Purchasing Managers' Index (PMI) rose to 55.7 in October, signaling a recovery in the manufacturing and agriculture Source

• Private Sector Credit Growth at Three-Year Low: Credit growth slowed to 9.20% in September amid high inflation, cautious lending, and rising interest rates Source

Banking

• Tax Filing Linked to More Services: The National Board of Revenue will link tax return submission to 43 services, boosting compliance and tax collection Source

• Islamic Banking Overhaul: New legislation will require banks to separate conventional and Islamic banking operations, leveling competition among Shariah-compliant financial institutions Source

Trade & Commerce

• Garment Exports to US Fall by 6.29%: Bangladesh’s garment exports to the US dropped by 6.29% from January to September 2024, reflecting broader market shifts Source

• Tea Exports at Seven-Year High: Bangladesh’s tea exports reached their highest levels since 2017, driven by competitive pricing against premium Indian and Sri Lankan brands Source

• Jewelers Reduce Gold Prices: Following a drop in local market rates, jewellers have reduced the price of gold by BDT 3,452 per bhori Source

International

• Vietnam Expands Semiconductor Manufacturing: Vietnam is ramping up investments in the semiconductor back-end manufacturing sector to reduce dependence on China Source

• India’s Retail Inflation at 14-Month High: Driven by rising vegetable prices, India’s retail inflation surged to 6.21% in October, surpassing the central bank’s target band Source

• Bangladesh Eyes USD 1bn in Semiconductor Exports by 2030: The Bangladesh Semiconductor Industry Association aims to boost exports to USD 1bn, focusing on training engineers and R&D growth Source