Inflation at 8.78% in Feb

The general point-to-point inflation rate has increased by 0.21 percentage points to 8.78 per cent in February this year, compared to this January.

In 2022, the inflation rate was 8.57 per cent in January and 8.71 per cent in December, according to the Consumer Price Index (CPI) and Inflation Rate and Wage Rate Index (WRI) in Bangladesh.

According to the latest data from the Bangladesh Bureau of Statistics (BBS) released on Sunday, food inflation was 8.13 per cent and non-food inflation was 9.82 per cent in February 2023.

Food inflation was 7.76 per cent while non-food inflation was 9.84 per cent in January this year.

The BBS inflation data, however, did not fully reflect the ongoing situation in kitchen markets as essential commodity prices are still soaring across the country.

After a meeting of the Executive Committee of the National Economic Council on Sunday, State Minister for Planning Prof Shamsul Alam told reporters, “Bangladesh’s inflation rate has increased but the wage index rate is also going up.”

The country’s inflation has become uncomfortable but it’s still not at a hyper level in terms of economy, he said, adding that Zimbabwe and Pakistan have 300 per cent and 40 per cent inflation, respectively.

Bangladesh’s inflation is mainly based on production costs, he said. “It may take five-six months to reduce the production costs.”

Shamsul said the country’s overall economy is stable now after recovering from the impacts of the Covid-19 pandemic and the Russia-Ukraine war.

Meanwhile, the country’s wage index rate stood at 7.11 per cent in February 2023, rising from 7.06 per cent in January this year.

In September 2022, the inflation rate was 9.10 per cent, compared to 9.52 per cent in August – which remains the country’s highest in 11 years, show the BBS data. According to the national budget, Bangladesh had set the inflation target at 5.6 per cent for FY2022-23.

The inflation in rural areas rose at a higher rate than that of the urban areas this February.

In February, the rural inflation increased to 8.80 per cent from January’s 8.67 per cent. Urban inflation also rose to 8.75 per cent in February from January’s 8.39 per cent.

The food inflation in rural areas was at 8.19 per cent last month, up from 7.92 per cent in January. In urban areas, it was at 7.98 per cent last month, up from 7.41 per cent in January.

The non-food inflation in rural areas also decreased to 9.98 per cent in February from January’s 10.12 per cent. However, in urban areas, it also rose to 9.61 per cent in February from 9.48 per cent in January.

Responding to the latest data, Consumers Association of Bangladesh President Golam Rahman told The Business Post that the inflation statistics of BBS did not reflect the real scenario in line with the prices of daily essentials in the kitchen markets.

“The real inflation rate is more than the BBS data represents because the prices of all kinds of essentials are high. The inflation situation has significantly worsened and it has already impacted negatively the lives of low and middle-income people across the country,” he said.

The government should increase the monitoring system in both wholesale and retail markets to stabilise food inflation, he added.