Tue, 26 Sep 2023

by Naim-Ul-Karim

DHAKA, June 6 (Xinhua) -- Inflation in Bangladesh jumped to 9.94 percent in May, the highest in the past decade, mainly driven by higher food prices, the Bangladesh Bureau of Statistics (BBS) reported Monday.

Data showed that food inflation increased to 9.24 percent in May from 8.84 percent in the previous month.

Also, non-food items inflation increased to 9.96 percent in May from 9.72 percent in April, the data showed.

The country's previous high inflation in recent times was recorded in August last year when the Consumer Price Index accelerated to 9.52 percent, the highest in 10 years.

Due to higher food prices amid uncertainties stemming from the Russia-Ukraine conflict, inflation in Bangladesh has also been on an upward trend over the past several months.

According to the latest budget proposal, Bangladesh targets an average inflation rate of 6.5 percent in the new fiscal year starting in July.

The Bangladeshi government on Thursday unveiled a record 7.62-trillion-taka (71-billion-U.S. dollar) national budget for the 2023-24 fiscal year starting in July.

The government projected economic growth of 7.5 percent in the annual budget.

Focusing on tackling inflation, job creation, the fourth industrial revolution, and "Smart Bangladesh," Finance Minister AHM Mustafa Kamal presented to the parliament the budget of Prime Minister Sheikh Hasina's government.

He said the government is committed to containing the rising trend of inflation by addressing inconsistencies between supply and demand.

Although inflationary pressure increased, the government has been making an all-out effort to check the inflation and mitigate its impact on the people, the minister added.

In its budget reaction, the country's leading think-tank Centre for Policy Dialogue (CPD) recently said the measures taken in the proposed budget have failed to address the most difficult challenge of containing inflation. As a result, the suffering of common people will increase further.

CPD Executive Director Fahmida Khatun said the government has set a target to keep the annual average inflation rate within six percent in the next fiscal year, but it will be difficult to do so due to the current macroeconomic situation.

The weakest side of the budget is that no effective measure was taken to tackle the inflationary pressure, said Khondaker Golam Moazzem, a research director of the CPD.

In recent months, prices of many essentials in Bangladesh have been seen rising in the short term on a supply shortage.

The price hike of food items, particularly staple rice, is a key concern for the Bangladeshi government as 18.7 percent of its around 165 million people still live below the national poverty line and spend a large part of their incomes on food purchases.

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