Headlines
Reserves cross $36b on loans as external debt tops $78bn — gross flatters net.
Food's Share of Spending Rises as Income Falls
An IMF chart, built on USDA data, plots food spending as a share of GDP against food's share of total consumer spending. Poorer economies sit further up and further right on both scales.
- ▸Advanced economies hold the bottom-left corner. Food takes roughly 5 to 22 percent of consumer spending in that group, on food outlays worth under about 13 percent of GDP.
- ▸Emerging markets spread across the whole middle of the chart. Their markers run from about 11 percent of consumer spending to above 40 percent, and the group overlaps the advanced cluster at one end and the low-income band at the other.
- ▸Low-income developing countries occupy the top-right. Every marker in that group sits above roughly 29 percent of consumer spending, and the highest of them approach 55 percent.
A household that already spends half its money on food has no cheaper category to move into, so a price rise comes out of everything else it buys. The IMF places Bangladesh in the low-income group at the upper right of this chart. Food and beverages carry the largest single weight in the Bangladesh CPI basket, which is the same fact seen from the other side.
Food inflation belongs in the credit process, not only in the macro commentary. A price move reaches disposable income before it reaches any borrower's file, and the thinnest-buffer books — retail, microfinance-linked exposure, small-ticket SME — feel it first. A risk team reading food prices only off the monthly CPI print is working from the slowest signal available.
Policy & Rates (Bangladesh Bank)
Policy held at 10%; the reserve lift past $36b is JICA-borrowed.
FX Reserves
WATCH
- ◆The next MPS for any signal off the 10% hold
- ◆June CPI for the IMF-tied 15% VAT pass-through
- ◆High-powered-money growth as an inflation-combat drag
RISK
- ▼Reserve build is loan-funded — net softer than the reported $36b gross
- ▼The high-powered-money surge undercuts the disinflation path
- ▼Sticky non-food CPI at 9.09% blocks any rate cut
Banking
On the Q1 print, 1.56% CAR — 844bp below floor — is the real bind.
WATCH
- ◆Bank-level Q1 2026 disclosures — the write-off-vs-recovery split
- ◆Whether Apex Spinning's closure and decade-low growth convert to fresh NPLs
- ◆WB's $450m banking-reform terms — recapitalisation or process
RISK
- ▼CAR 844bp below floor — the solvency hole is unmoved on the Sep 2025 read
- ▼Decade-low industrial growth feeds fresh default formation
- ▼A spread cap thins margins just as capital needs rebuilding
Banking is not today's lead, but it remains the system's structural bind, and the Q1 2026 print is unchanged: NPLs at 32.26% rest on a 1.56% CAR (Capital Adequacy Ratio) — 844bp below the 10% floor, held on write-off arithmetic, not cures. The fresh inputs all tighten the screw. Industrial growth has hit a decade low and Apex Spinning is shuttering a Gazipur mill with 5,000 jobs — a default pipeline the sector cannot absorb. Banks have already drawn Tk 76,000cr of liquidity support to June 6, a sign the funding base leans on the central bank, not deposits. WB's $450m for banking reform is welcome, but it underwrites process — supervision, resolution — not the capital hole. The desk reads any re-rating as sentiment, not solvency, and stays defensive until a recapitalisation plan, not a reclassification, lands.
FX & External
Reserves past $36b on JICA money; the mid holds 122.75, market near 123.10.
External Flow Balance
Remittance $3.43bn barely covers the $3.04bn May trade gap — cover over the gap is just $0.39bn; the mid holds 122.75.
May remittance held $3.43bn against the $3.04bn gap; pre-Eid inflow now past, the June–July dip ahead.
Treasury: reserves past $36b are JICA-borrowed — watch the June–July dip and $78.22b external-debt service against the same reserves.
WATCH
- ◆Market USD/BDT against the 122.75 mid — the spread is the stress gauge
- ◆June–July seasonal remittance dip after the held $3.43bn May print
- ◆External debt repayment path as it reaches $78.22b
RISK
- ▼Reserve build is JICA-borrowed — net softer than the reported $36b gross
- ▼External debt at $78.22b raises FX-denominated service against thin reserves
- ▼Remittance cover over the trade gap at $0.39bn — one soft month from negative
FX is today's lens, and the headline flatters the book. Reserves are reported past $36b after a JICA disbursement — on its face, cover rebuilt. It is not: the lift is borrowed, and the same day external debt is reported at $78.22b with the repayment burden set to rise. Gross reserves climb while the net claim on them climbs faster. Underneath, the current-account math is unchanged — May's $3.04bn trade gap clears its $3.43bn remittance by just $0.39bn, and the June–July post-Eid dip is the near drain; import cover sits at 5.86 months. The official mid holds 122.75 while the market trades near 123.10 — the spread, not the fix, is where pressure shows. The book stays defensive on sovereign-linked FX service: the reserve number flatters the position, and the debt-service line into FY27 is the one to watch.
DSE Markets
Non-trading day; DSEX holds its 21 Apr 5,257 print as the tape stays stale.
DSEX Index
DSEX last printed 5,257 on 21 Apr — successive non-trading sessions leave no fresh tape.
The tape is stale at the 21 Apr 5,257 print; the reopen is the next read.
Equity desk: hold large-cap quality into the reopen — reserves past $36b and external debt at $78.22b are the new inputs.
WATCH
- ◆First trading session to reprice external debt at $78.22b and reserves past $36b
- ◆Bank-sector reaction to the 32.26% Q1 NPL and 1.56% sector capital ratio
- ◆Whether turnover holds above BDT 1,000cr on the reopen
RISK
- ▼Bank-heavy index exposed to the distressed-loan pile
- ▼Stale tape — the reopen reprices reserves, external debt and budget at once
- ▼Taka near 123.10 pressures import-dependent large-caps
T-Bonds & T-Bills
The front-end holds 9.70% on the 91d; the long end stays anchored.
BD Govt Yield Ladder
Curve front-end holds its cut — 91d 9.70%, 182d 9.89%, 364d 9.93%, 5y 10.35%, 10y 10.24%, ~67bp under the earlier 10.91%.
The 91d held 9.70% across the last three reads; the 10y holds 10.24% since the post-budget rally.
ALCO: the front-end eases while the external account tightens — fund short, but margins compress; watch supply at the next post-budget auction.
WATCH
- ◆Whether the next auction extends the 91d cut below 9.70%
- ◆June CPI — non-food at 9.09% the risk to the front-end bid
- ◆FY27 supply as external debt reaches $78.22b and the offshore tilt is tested
RISK
- ▼FY27 deficit math pushing domestic borrowing back re-steepens the curve
- ▼The high-powered-money surge re-prices inflation risk into the front-end
- ▼The rally compresses margins on short-funded ALM (Asset-Liability Management) books
Macro & Inflation
On the Mar print, 12m-avg held 8.6% — lowest since Mar 2023; credit 6.03%.
CPI Trend
CPI 12m-avg held 8.6% on the Mar print — food 8.24%, non-food 9.09% — the disinflation read stalled.
12m-avg at lowest since Mar 2023 (8.4% then), but non-food at 9.09% keeps the average from falling.
MPC: disinflation stalled — yet the auction front-end held its cut (91d 9.70%); credit at 6.03% says capital, not the policy rate, binds.
WATCH
- ◆June CPI for the IMF-tied 15% VAT and high-powered-money pass-through
- ◆Non-food above 9% (9.09%) as the stickiness tell
- ◆Private credit at 6.03% — the 60-period low as the demand tell
RISK
- ▼The high-powered-money surge undercuts the disinflation path into June
- ▼The uniform 15% VAT compounds the June CPI
- ▼Private credit at 6.03% signals dead demand transmission
Remittance
Remittance held $3.43bn; cover over the $3.04bn gap stays thin into the dip.
Remittance Inflow
WATCH
- ◆June–July seasonal pattern — pre-Eid inflows now past
- ◆Whether the $3.43bn pace holds into the dip as the gap stays wide
- ◆Whether a kerb premium opens as the market rate nears 123.10
RISK
- ▼Post-Eid seasonal dip typical in June–July — cover already thin at $0.39bn
- ▼Informal-channel share widens if the market/official spread passes 123.10
Commodities
Gold softens to $4,012; LNG holds $15 on the stale 20 Apr print.
WATCH
- ◆LNG spot for June–August monsoon-demand pricing
- ◆Gold as a global risk-sentiment proxy near $4,012/oz
RISK
- ▼LNG spike on monsoon power demand lifts Petrobangla off-take costs
- ▼Gold weakness signalling risk-on rotation that pressures EM safe-haven flows
Fiscal
External debt tops $78bn; the offshore financing tilt deepens as NBR stalls.
NBR Tax Revenue
Monthly NBR revenue run-rate held flat — YTD collection steady at Tk 3.27tn, still trailing the Tk 4.15tn FY27 target.
The Tk 3.27tn YTD level has held flat across the last twelve reads — the pace is set, not accelerating.
Treasury/ALCO: a flat run-rate means the deficit leans offshore — external debt now $78.22b, and the IMF prices VAT as a condition.
WATCH
- ◆External debt repayment path as it reaches $78.22b
- ◆First post-budget T-Bill auction — the deficit-financing mix in practice
- ◆WB's $450m and JICA disbursements as the concessional cushion thins
RISK
- ▼Offshore tilt swaps domestic crowding for FX-denominated service as the runway thins
- ▼Execution shortfall pushes domestic bank borrowing higher into FY27
- ▼A tax base near the world's lowest caps domestic financing
Fiscal is where the runway thesis bites. External debt now reaches $78.22b, and the authorities concede the repayment burden will rise in coming years — the offshore-financing pivot chosen for FY27 has a bill, and it is arriving. The domestic side cannot close the gap alone: NBR's Tk 4.15tn FY27 target sits against a run-rate stuck flat at Tk 3.27tn YTD, which is why the IMF still prices a uniform 15% VAT as a loan condition and WB's $450m comes earmarked for reform. Govt bank borrowing already holds BDT 1.25tn past the FY26 ceiling. The headline reserve build past $36b is the same coin — JICA money in, debt-service obligations out. The FY31 8.5% growth target needs a revenue lift the base has not delivered in a year. The desk watches the first post-budget auction for the financing mix, and the debt-service line into FY27 for the squeeze.
Iran War & Oil
Brent eased to $73.11, deeper below $80; the import-bill cushion widens.
Brent Crude
Brent eased to $73.11, WTI $69.87 — extending the slide below $80 after recent firmer sessions.
Spot sits well under $80; the sub-$80 zone that underwrote FY27's pre-war oil math holds.
Treasury: the import-bill cushion widens below $80 — watch the $80 line and the US-Iran deal's durability into the two-month window.
WATCH
- ◆Whether the US-Iran accord holds Brent below $80 past the two-month window
- ◆Oil pass-through into June CPI atop the IMF-tied 15% VAT
- ◆Import-bill drag against the $3.04bn trade gap and the taka near 123.10
RISK
- ▼A talks collapse re-arms the subsidy and import-bill tail
- ▼Hormuz-route risk to Bangladeshi cargo as vessels transit the strait
- ▼FY27 projections under-provision if oil round-trips higher
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