The Asian Development Bank (ADB), in its latest outlook, has projected that inflation in Bangladesh will rise to 10.1 per cent in the fiscal year 2024-25, a significant increase of 3.1 percentage points from its previous estimate made in April.
The Bangladesh Bureau of Statistics (BBS) recently released data indicating that general inflation stood at 10.49 per cent in August 2024, down slightly from 11.66 per cent in July. In comparison, inflation was 9.92 per cent in August 2023, 9.52 per cent in August 2022, and 5.54 per cent in August 2021.
The ADB’s forecast attributes the anticipated rise in inflation to ongoing supply-side disruptions and higher import costs resulting from currency depreciation. The international lender expects inflation to remain in double digits through the end of FY 2024-25.
The former government, ousted on August 5 following a mass uprising, had set a target to reduce inflation to 6.5 per cent for this fiscal year after it surged to 9.7 per cent in FY 2023-24. Despite these efforts, elevated food and non-food prices in the first half of FY 2024-25 have been pushing inflation higher, exacerbated by supply chain issues and increased import costs.
According to the ADB, these factors will continue to strain consumers, who have already faced persistent inflationary pressures for the past two years. Inflation has remained above 9 per cent during this period, impacting household budgets and increasing the cost of living.
Despite the ADB’s cautionary outlook, there is hope that inflation could ease by mid-2025. Dr Ahsan H Mansur of Bangladesh Bank expressed optimism that inflation would decrease to a more manageable level of 6-7 per cent by March-April of 2025.
