The inflation rate in Bangladesh hit 9.93 per cent in October, the second highest in a month this year so far, up from 9.63 per cent in September, according to the latest Bangladesh Bureau of Statistics (BBS) data.
Food inflation increased to 12.56 per cent last month, which was 12.37 per cent in September, while non-food inflation in October also rose to 8.30 per cent, which was 7.82 per cent in September.
Food prices have been increasing over the months in the country and contributing to food inflation, especially the prices of onions and potatoes while putting consumers in trouble. Onions are currently being sold at Tk 130-140 per kg, which is Tk 70-80 more than what was a few months ago.
The price of potatoes has reached Tk 65 per kg in the retail market, which was Tk 30 just two months ago.
Inflation in rural areas has outpaced urban areas again as the rates reached 9.99 per cent and 9.72 per cent, respectively, in October. Rural inflation was at 9.75 per cent and inflation in urban areas was at 9.24 per cent in September.
In rural and urban areas, both food and non-food inflation rates have increased, according to BBS data.
In rural areas, food inflation was at 12.51 per cent in September and it went up to 12.53 per cent in October. Meanwhile, non-food inflation increased from 7.42 per cent to 8.01 per cent.
In urban areas, food inflation was at 12.01 per cent in September and it climbed to 12.58 per cent in October. The non-food inflation rose from September’s 8.12 per cent to 8.50 per cent in October.
In September, the overall inflation rate had dropped slightly by 0.29 percentage points to 9.63 per cent from 9.92 per cent in August.
Between January and October this year, May saw the highest general inflation rate of 9.94 per cent — leaving October with the second highest and August with the third.
The country has been facing significant inflationary pressure since the last fiscal year, primarily attributed to the Russia-Ukraine war, which led to soaring global market prices, as well as domestic USD supply challenges. Although global prices have now become stable, Bangladesh is still struggling to control inflation.
The government has set a target of keeping inflation at 6 per cent in the FY2023-24 budget but it is yet to put any strong impact on the inflation. Economists have been advising Bangladesh Bank to take initiatives to tame inflation first and bring stability to the economy.
The inflation showed a downward trend in the first two months (June and July) of FY24. However, it went up again in August to 9.92 per cent.
Currently, it is continuing its recent trend of higher general and food inflation rates in rural areas than the urban, even though rural areas host the lion’s share of agricultural production.
Food inflation reduces people’s purchasing power, especially those in the fixed-income groups. This also triggers an increase in the number of poor populations. The number of new poor people has already increased following the Covid-19 pandemic.
