The world economy resisted battering by conflicts and inflation last year and is expected to grow a subdued 2.8% in 2025, the United Nations said Thursday. In “World Economic Situation and Prospects 2025,” U.N. economists wrote that their positive prediction was driven by the strong although slowing growth forecast for China and the United States and by the robust performances anticipated for India and Indonesia. The European Union, Japan, and United Kingdom are expected to experience modest recovery, the report says. “We are in a period of stable, subpar growth,” said Shantanu Mukherjee, chief of the Global Economic Monitoring Branch at the Economic Analysis and Policy Division at the U.N.'s Department of Economic and Social Affairs. “This may sound a bit like what we were saying last year, but actually if you lift the hood and take a peek at the engine things are humming,” he said. The report says the U.S. economy outperformed expectations last year thanks to consumer and public-sector spending, but growth is expected to slow from 2.8% to 1.9% this year. The report points out that China sees its own strong growth slowing slightly from 4.9% in 2024 to 4.8% in 2025 due to lower consumption and property-sector weaknesses that are failing to make up for public investment and export strength. This is forcing the government to enact policies to lift property markets, fight local government debt and boost demand. Read: ADB, WTO strengthen collaboration for sustainable economic growth in Asia-Pacific region China's “shrinking population and rising trade and technology tensions, if unaddressed, could undermine medium-term growth prospects,” the report reads. The U.N. projected last January that 2024 global economic growth would be 2.4%. It said Thursday that the rate was estimated to have been higher, at 2.8%. Both remain below the 3% rate that the world saw before the COVID-19 pandemic started in 2020. European growth this year is projected to gradually pick up after a weaker than expected performance in 2024. Japan is poised to pick up from periods of near-recession and recession. India is expected to drive a strong outlook for South Asia, with regional growth projected at 5.7% in 2025 and 6% in 2026. India's 6.6% growth forecast for 2025 is backed by solid private consumption and investment growth, the report says. “The global reduction of poverty over the past 30 years has been driven by strong economic performance. This has been especially true in Asia, where rapid economic growth and structural transformation have allowed countries such as China, India, and Indonesia to achieve poverty alleviation unprecedented in scale and scope,” the report says. Read mor: Japan reaffirms commitment to support Bangladesh’s reform agenda and economic growth “The world economy has largely avoided a broad-based contraction despite the unprecedented shocks of the last few years and the most prolonged period of monetary tightening in history,” said Li Junhua, director, of the Economic Analysis and Policy Division at the Department of Economic and Social Affairs. However, he cautioned, “the recovery remains driven primarily by a few large economies.”

Bangladesh's inflation slightly eased in December, with overall inflation dropping by 0.49 percentage points and food inflation by 0.88 percentage points, providing some relief to consumers. According to the latest data released by the Bangladesh Bureau of Statistics (BBS) on Monday (January 6), overall inflation in December stood at 10.89%, down from 11.38% in November. Food inflation, a significant contributor to the country's rising cost of living throughout the past year, dropped to 12.92% in December, compared to 13.80% in November. Read: Inflation in Bangladesh climbs to 11.38% in Nov Non-food inflation also saw a marginal decline, decreasing from 9.39% in November to 9.26% in December. Rural and Urban Trends Inflation trends varied slightly between rural and urban areas. In rural regions, overall inflation dropped by 0.44 percentage points to 11.09% in December. Read: Inflation overshadows Bangladesh’s economic stride in 2024 Among this, food inflation stood at 12.63%, while non-food inflation reached 9.65%. In urban areas, overall inflation declined by 0.53 percentage points, settling at 10.84% in December. Food inflation in cities was reported at 13.56%, with non-food inflation at 9.17%. This fall in inflation offers some relief to households across the country, although rates remain high, particularly for food items, said economists, urging policymakers to focus on stabilising prices further to ensure economic resilience in the months ahead.

Bangladesh’s economy in 2024 faced major challenges, as rampant inflation not only eroded purchasing power but also overshadowed the country’s progress in other areas, underscoring the growing struggle to balance development amid rising economic pressures. The rising cost of living, driven by domestic and international factors, strained households and tested the government's economic strategies, yet the country maintained moderate growth due to its resilient economic framework. The inflation rate in Bangladesh reached an alarming average of 11.38% in November 2024, marking the highest level in over a decade. Inflation hit 11.66 percent in July, the highest at least since the 2010-11 fiscal year, driven mainly by food prices reflecting the worsening of the purchasing capacity of people. This sharp increase was fuelled primarily by escalating food prices, which constitute a significant portion of household expenditure and the Consumer Price Index (CPI). For comparison, the inflation rate stood at 8.56% in 2023, reflecting the worsening situation in 2024. Food inflation, in particular, hovered around 12%-14% for most of the year, as prices of essentials like rice, cooking oil, and vegetables surged. Non-food inflation also rose steadily, driven by increased transportation costs, higher utility bills, and imported goods becoming more expensive due to currency depreciation. Several factors contributed to the inflationary pressures in Bangladesh during 2024: Global Commodity Prices: Fluctuations in global commodity markets, particularly for energy and food products, had a direct impact on domestic prices. The war in Ukraine continued to disrupt global supply chains, leading to higher import costs for essential items like fuel, wheat, and edible oils. Currency Depreciation: The Bangladeshi Taka depreciated significantly against the US dollar, exacerbating inflationary pressures. The currency weakened by approximately 10% in 2024, making imports more expensive and driving up prices in the domestic market. Supply Chain Disruptions: Persistent disruptions in global and regional supply chains further aggravated the inflation problem. Delays in shipping and logistical bottlenecks caused shortages of key commodities, leading to price hikes. Domestic Demand Pressures: Rising domestic demand, particularly during festival seasons, added to inflationary pressures. While increased consumer spending is typically a sign of economic vitality, it also contributed to supply-demand imbalances. The inflation crisis severely impacted households across Bangladesh, particularly low- and middle-income families. The increased cost of essential goods such as rice, pulses, and cooking oil eroded purchasing power, forcing many families to cut back on non-essential expenditures. Reports indicated that some households were skipping meals or substituting more expensive foods with cheaper alternatives. Read: Previous govt distorted inflation data: Press Secretary Urban areas, where reliance on market purchases is higher, faced acute challenges. Meanwhile, rural households, though somewhat shielded by local agricultural production, also struggled with rising input costs for farming. Real wages for workers in both formal and informal sectors failed to keep pace with inflation, further widening income inequality. The situation underscored the urgent need for targeted social safety nets and measures to protect vulnerable populations. The queues behind OMS trucks across the country is getting longer and longer as the middle-class and lower-middle class people are feeling the pinch of the inflation at the worst level. The government and the Bangladesh Bank implemented several measures to combat inflation and stabilize the economy: Monetary Policy Tightening: The central bank raised the repo rate five times in 2024, reaching 10% in October. This marked a significant tightening of monetary policy aimed at curbing inflation by reducing liquidity in the market. However, higher interest rates also made borrowing more expensive, potentially dampening business investment. Subsidy Adjustments: The government increased subsidies on food and energy to cushion the impact of rising prices. Special programs were introduced to provide subsidized rice and wheat to low-income families. Exchange Rate Reforms: In May 2024, Bangladesh Bank adopted a crawling peg exchange rate system to reduce the gap between formal and informal exchange rates. This reform aimed to stabilize the Taka and improve foreign exchange reserves, which stood at around $25 billion by year-end. Market Monitoring: To control price manipulation, the government intensified market monitoring efforts. Task forces were deployed to prevent hoarding and ensure fair pricing of essential goods. Social Protection Programs: The government expanded cash transfer programs and food aid schemes to support the most affected households. Initiatives like the Vulnerable Group Feeding (VGF) program were scaled up to reach millions of beneficiaries. Despite high inflation, Bangladesh’s GDP growth remained positive, albeit slower than in previous years. The Asian Development Bank (ADB) projected a growth rate of 5.8% for 2024, while the International Monetary Fund (IMF) estimated 5.4%. This growth was driven by robust performance in the manufacturing and export sectors, particularly the ready-made garment (RMG) industry, which accounted for over 80% of export earnings. Read more: Inflation in Bangladesh climbs to 11.38% in Nov However, domestic consumption and investment faced challenges due to inflationary pressures and higher borrowing costs. Small and medium enterprises (SMEs), a backbone of the economy, struggled with rising input costs and reduced consumer demand. To address economic challenges, Bangladesh sought international assistance. In September 2024, the World Bank pledged over $2 billion in financing for various initiatives, including flood response measures, healthcare improvements, and air quality management. Besides, the IMF disbursed $680 million as part of its Extended Credit Facility (ECF) program, supporting fiscal reforms and boosting foreign exchange reserves. These funds provided much-needed relief and underscored Bangladesh’s strong ties with global development partners. The well connected interim government is getting various types of budgetary support in different names which are giving little bit relief for the government, which took charge on August 8 after the fall of Awami League regime through a mass movement of students and people. Bangladesh faces a delicate balancing act for the coming days. The government aims to reduce inflation to below 7% by mid-2025, a target that will require sustained efforts in monetary and fiscal management. For this it needs to give priorities in some areas. These are: Strengthening Agriculture: Boosting domestic food production through incentives and technological advancements could help reduce reliance on costly imports. Enhancing Social Safety Nets: Expanding targeted programs for low-income households will be critical to mitigating the impact of inflation on the most vulnerable. Structural Reforms: Improving governance, streamlining tax collection, and addressing inefficiencies in public spending are essential for long-term economic stability. Diversifying Exports: Reducing dependence on the RMG sector by promoting industries like pharmaceuticals, IT, and agro-processing can provide new growth avenues. The year 2024 was marked by significant inflationary challenges for Bangladesh, testing the resilience of its economy and the effectiveness of its policy responses. While inflation strained households and businesses, the country’s moderate growth and robust export performance offered hope for recovery.

The general point-to-point inflation rate in Bangladesh rose in November reaching 11.38 percent, up from 10.87 percent in October 2024. This rate is the highest in the last four months. According to the latest data from the Bangladesh Bureau of Statistics (BBS), the increase was driven by a rise in food inflation, which jumped to 13.80 percent from 12.66 percent. IMF suggests upward policy rate in 2025 to restrain inflation: BB Meanwhile, non-food inflation showed a slight rise of 9.39 percent from 9.34 percent in November. The general point-to-point inflation rate both in urban and rural areas also increased last month. The point-to-point inflation in rural areas in November was 11.53 percent which was 11.26 percent in October. The food inflation in the rural areas was 13.41 percent in November from 12.75 percent in October while the non-food item was 9.72 percent in November from 9.72 percent in October.  On the other hand, the point-to-point inflation rate in urban areas in November was 11.37 percent which was 10.44 percent in October. The food inflation in November was 14.63 percent which was 12.53 percent in October while the non-food item in November was 9.31 percent which was 9.06 in October.    The wage rate index in November was 8.10 percent which was 8.07 percent in October 2024.

With Bangladesh facing higher inflation for a long time, the International Monetary Fund (IMF) has advised keeping the policy interest rate on the rise until inflation decreases. Bangladesh Bank Spokesperson and Executive Director Huseara Shikha hinted this while talking to reporters at her office on Tuesday. She said this ahead of a delegation led by IMF mission Chief Chris Papadakis, scheduled to visit Bangladesh from December 3 to 17 to review the IMF conditions. The IMF says that inflation in Bangladesh is currently above 11 percent. It will remain around 10 percent throughout 2025, and after that, the international donor agency believes it may come down to 6 to 7 percent. The fourth tranche of the US $4.7 billion loan program depends on fulfilling the conditions given by the global lender. Read: BB Governor projects inflation reduction in 8 months The IMF imposed conditions on Bangladesh for providing this loan. Although almost all the conditions given by the lender are on track to be met, it is well behind the revenue collection target. However, the installment has already been released after showing progress in fulfilling most of the conditions. Earlier, in January 2023, the IMF approved a $4.7 billion loan for Bangladesh. It was supposed to provide this loan to Bangladesh subject to conditions. The IMF delegation is reviewing each installment of this loan, which was given in seven installments, before releasing it.

Bangladesh Bank Governor Dr. Ahsan H. Mansur on Thursday said that implementing the government’s monetary policy aimed at curbing inflation will require 12 to 18 months. “After tightening the monetary policy, it takes 12 to 18 months to bring down the inflation rate. So, we have to be patient,” Dr. Mansur said during a press briefing following a meeting on inflation at the Finance Ministry, chaired by Finance Adviser Dr. Salehuddin Ahmed. The governor clarified that the central bank’s approach is focused on controlling inflation rather than reducing the overall price level. “We manage inflation; we don’t aim to lower the price level itself. No country seeks to reduce prices to avoid the risk of deflation,” he explained. Inflation in Bangladesh went up in Oct Deflation, a sustained drop in the price level of goods and services, can initially seem beneficial as money gains purchasing power. However, prolonged deflation can hamper economic growth and often arises during periods of economic instability. Its impact, Dr. Mansur noted, can have both positive and negative effects on the economy. Addressing public expectations, Dr. Mansur urged citizens to remain patient as the policy gradually takes effect. “This isn't something that can be achieved in two to three months. At best, we might see results in 12 months, but 18 months is a more realistic timeframe,” the Bangladesh Bank governor said. BB will ask banks not to impose LC margin on essentials import until Ramadan

Residents of Magura are increasingly distressed as the prices of essential commodities have surged alarmingly across the district. The sudden spike has left many struggling to make ends meet, raising widespread concerns about the impact on daily life. In recent weeks, prices of various essential items, including vegetables, eggs, and chillies, have escalated dramatically. The price of raw chillies has soared to Tk 500 per kg, an incredible increase from just Tk 100 to Tk 120 per kg two weeks ago.  Similarly, farm eggs are now selling at a record high of Tk 180 per dozen, up from Tk 150 a week earlier. Local markets have felt the impact of these price hikes, making it increasingly difficult for families, especially those from middle and lower-middle-class households, to afford basic groceries. The prices of potatoes, bitter gourds, and brinjals have also surged, with potatoes now costing Tk 60 per kilogram, pointed gourds at Tk 80 per kg, and brinjals reaching Tk 120 per kg. Read: Drives conducted in Dhaka’s kitchen markets to monitor prices of essentials “This is becoming unbearable. Everything costs more, yet our incomes remain unchanged. It’s a struggle to buy groceries,” lamented a local buyer. The situation is dire, with some families reportedly leaving markets empty-handed due to soaring prices.  “Many come to the market without buying anything and leave disappointed, while others are forced to pay inflated prices,” another resident added. Market control officials attribute the crisis to excessive rainfall disrupting supply chains, and rising wholesale prices.  “Due to heavy rainfall and increased wholesale prices, the costs of raw chilies and vegetables are rising daily,” stated an official. They expressed concern that if this trend continues, prices may escalate further. Rising transport costs are also contributing to the increases, they noted. The repercussions of these price surges are evident, with many vendors reporting a decline in sales. “I used to sell out my stock easily, but now many customers leave without making a purchase,” said one seller, highlighting the impact on local businesses. Read more: Special task force formed to monitor prices of daily essentials The markets have become nearly devoid of small fish, with what little remains priced beyond the reach of average buyers. Larger fish are also expensive, making them inaccessible to many. Even during the peak hilsa season, prices remain high, with almost every vegetable priced at 80 to 120 takas. Meanwhile, although the prices of beef, goat, and both local and broiler chicken have not surged, the costs of rice and oil have increased. District market control officer Mamunul Islam confirmed that excessive rainfall and rising wholesale prices are driving up the costs of raw chilies and vegetables. He noted the potential for further price increases if the situation continues, exacerbated by rising transport costs.  Read more: Essentials’ prices up in Khulna kitchen markets

The National Board of Revenue (NBR) on Wednesday reduced the regulatory duty on both refined and raw sugar imports by 50 percent to stabilize the local market prices. The duty has been cut from 30 percent to 15 percent, effective immediately. NBR explained that this measure is intended to make sugar prices more bearable for consumers.  It pointed out that various global and domestic factors have contributed to the recent rise in the prices of daily essentials, including sugar. Due to the global war, political unrest, and the significant devaluation of the Bangladeshi currency, prices of several essential goods have escalated. Items such as baby food are also becoming increasingly unaffordable for the common man, NBR noted. It further said that recent student protests and the ongoing flood situation have added additional pressures, driving prices of essential items even higher. NBR accelerates efforts to clear revenue case backlog As a result of the 15 percent reduction in regulatory duty, the customs duty on raw sugar now stands at Tk 11.18 per kg, while refined sugar is taxed at Tk 14.26 per kg at the import level. The NBR expects the price of sugar to decrease by a similar amount at the consumer level.  The NBR also expressed hope that lowering the customs duty will discourage sugar smuggling through illegal channels and boost legal imports.  According to the available data, the annual consumption demand for sugar in Bangladesh is 2 to 2.2 million tonnes where Only 1.5 per cent of the country’s demand is met with locally produced sugar. Meghna Group of Industries (MGI) and City Group are the two main importers of sugar followed by S Alam Group, Abdul Monem Ltd and Deshbandhu Sugar Mills. At present, these five private sugar mills imports more than 98 percent of the country's annual demand for refined sugar, whereas the raw sugar mostly sourced from Brazil.

The European Union on Wednesday offered to delay by a year the introduction of new rules that would outlaw the sale of products that come from forests following an outcry from several governments claiming that it will damage trade and hurt small farmers. The EU’s executive branch, the European Commission, said that “it would make the law applicable on 30 December 2025 for large companies and 30 June 2026 for micro- and small enterprises,” if the 27 member countries and the bloc’s parliament agree. The deforestation regulation’s scope is wide, including things like cocoa, coffee, soy, cattle, palm oil, rubber, wood and products made from them. Critics say it discriminates against countries with forest resources and would hurt their exports, while supporters insist that it will help save forests on a global scale. Deforestation is the second-biggest source of carbon emissions after fossil fuels. In offering to delay the regulation by a year, the commission said that “several global partners have repeatedly expressed concerns about their state of preparedness,” most recently during the United Nations General Assembly in New York. Officials from leading exporters of affected commodities — including Brazil, Indonesia and the Ivory Coast — fear the regulation could act as a trade barrier, hit small farmers and disrupt supply chains. But even EU governments, including in Austria and Germany, have also sought to water the regulation down or delay its introduction. The commission conceded that “the state of preparations amongst stakeholders in Europe is also uneven. While many expect to be ready in time, thanks to intensive preparations, others have expressed concerns.” In addition to offering a delay, it published additional guidance to better clarify the rules for companies and to help national authorities enforce them. The commission encouraged EU member countries and the parliament to endorse the delay by the end of this year.

Dr. Ahsan H. Mansur, newly appointed governor of Bangladesh Bank, has said his priority will be to check the high inflation and restore stability in the financial sector.  Expressing satisfaction over his new responsibility Dr. Mansur told UNB on Tuesday night that he will work with all stakeholders in the financial sector to bring back stability and put it on a solid foundation. On Tuesday night the interim government's law ministry hurriedly waved the age limit of 67 years for anyone to be appointed as governor of the central bank. Economist Mansur is now 72 years old. The last time the age limit provision got amended from 65 years to 67 years was in July 2020 to accommodate the reappointment of then-governor Fazle Rabbi.  Read more: Money launderers won’t be allowed to sleep in peace: New Bangladesh Bank Governor He believed that despite high inflation - it hit 11.66 in July in a 13-year high- the central bank under the previous administration did not give full attention to curb it.  Controlling inflation remains a top priority for any central bank.  However, money supply, exchange rate stability, and inflation control all depend on the decision of the governor. Besides, the standard of living, international trade, investment, and employment depend a lot on the decisions of the central bank of any country, he said. Dr. Mansur started his career as a lecturer, at the Department of Economics, Dhaka University in 1976. He left for Canada for higher studies in economics the same year. As a graduate student and research assistant, he was also offering regular economics courses at the undergraduate level at the University of Western Ontario, Canada (1978-81).  Dr. Mansur joined the International Monetary Fund under its Economist Program in 1981 and thereafter completed his PhD in Economics (on general equilibrium analysis) from the University of Western Ontario in 1982. During his long career at the IMF, he worked in Middle Eastern, Asian, African, and Central American countries. He worked in important functional departments (Fiscal Affairs and Policy Review and Development departments) and area departments (Middle East and Central Asia and Asian departments) of the IMF. Read more: Inflation hits 13-year high of 11.7% in July: BBS He also served as the IMF Senior Resident Representative to Pakistan from 1998-01 and as the Fiscal Advisor to the Minister of Finance, Government of Bangladesh (1989-91).