Inflation eases slightly to 9.05% in May

Bangladesh's inflation rate declined slightly in May, easing to 9.05% from 9.17% in April, according to data released today (2 June) by the Bangladesh Bureau of Statistics (BBS).

The data reflects a marginal but positive decline in both food and non-food inflation. Food inflation fell to 8.59% from 8.63% in April, while non-food inflation dropped to 9.42%, down from 9.61% the previous month.

Dr Monzur Hossain, member of the General Economics Division, attributed the easing of inflation to a combination of supply-side and demand-side measures taken by the government.

"On the demand side, the central bank has pursued a tight monetary policy since the second half of FY25, aimed at curbing inflation and stabilising the foreign exchange market," he said.

He also highlighted fiscal measures such as reduced tariffs on key food imports – including rice and edible oil – which helped ease pressure on consumer prices.

On the supply side, Dr Monzur noted, favourable weather conditions played a crucial role.

"The steady availability of seasonal vegetables and crops, supported by the absence of floods or other climatic disruptions, has contributed to lower prices in recent months," he explained.

With the arrival of Boro rice in the market, he added, the downward trend in inflation is likely to continue, given rice's significant weight in the inflation basket.

Meanwhile, overall inflation in rural areas declined in May, driven by a drop in both food and non-food inflation.

An exception, however, was seen in urban food inflation, which rose to 9.29% in May from 9.13% in April. Despite the increase in food inflation, overall inflation in urban areas still declined.

On the other hand, while inflation eased, wages continued to rise. In May, the point-to-point wage growth stood at 8.21%, slightly up from 8.19% in April.

However, wage growth has remained below the inflation rate for the past 40 consecutive months, indicating continued erosion of real income.