Headlines
Cash hoarding up 34%; BSEC forces disclosure on a Tk9,367cr gap.
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)
The 7-day slips under the policy rate; term stress has cleared.
FX Reserves
WATCH
- ◆Whether the flat 9.67–9.93% short curve holds through month-end or the term bid returns as it did in mid-July
- ◆Cash hoarding up 34% — currency outside banks is the drain the corridor cannot price
- ◆The 182d bill clearing 9.79% against 14-day funding at 9.67% — a 12bp carry that will pull bids to the auction
RISK
- ▼A repeat of the mid-July term squeeze, when the 14-day traded through the 11.50% SLF ceiling for a week
- ▼Deposit flight re-tightening the system after the 34% jump in hoarded cash
- ▼A buffer dated 1 May being quoted against a barrel priced on 22 Jul — the cover number is older than the shock
Banking
Cash hoarding up 34% while listed lenders carry a Tk9,367cr hole.
WATCH
- ◆Whether the Tk9,367cr gap is closed in the Q2 2026 statements BSEC has now put on a quarterly clock
- ◆Whether cash outside banks keeps rising after the 34% jump — deposit growth, not the policy rate, is the constraint
- ◆Any Q2 2026 CAR disclosure that supersedes the Sep 2025 read of 1.56%
RISK
- ▼Tk9,367cr of unbooked provisions arriving as a capital charge on a sector already 844bp below the floor
- ▼A 34% rise in hoarded cash shrinking the low-cost deposit base that funds the loan book
- ▼Forced quarterly disclosure re-pricing the bank scrip that dominates the DSEX float
A provision gap is a capital hole that has not been booked yet. BSEC ordering the exchange to enforce quarterly reporting on Tk9,367cr does not create the loss — it dates it. Against a sector CAR of 1.56% on the Sep 2025 read, 844bp below the floor, there is nothing left to absorb it; the charge lands straight on the equity line. The funding side moved the same day and in the same direction. Cash hoarding is up 34% — depositors withdrawing from the system rather than repricing within it, which is the one behaviour a 10% policy rate cannot fix. Banks lose their cheapest liability while the asset side still carries a 32.26% NPL ratio on the Q1 2026 print. The new governance rules address process, and the Twin Tower lease raises cash from property. Neither is capital. Nothing re-rates this book but capital, and none is funded.
FX & External
USD/BDT holds 122.85 as Brent eases to $89.11.
External Flow Balance
Trade gap holds $1.77bn — exports $4.03bn against $2.82bn of remittance, leaving $1.05bn of monthly cover.
Import cover 5.86mo on the Mar read — lowest since Feb 2026 (5.3 then).
Treasury: with Brent easing to $89.11, hedge energy lines into the give-back rather than after the next trade print.
WATCH
- ◆Whether Brent's $1.85 give-back extends or the premium rebuilds — the run to $90.96 took a week to build
- ◆The next trade print — how much of the $1.05bn cushion the fuel bill takes at $89.11
- ◆The IMF review flagged today, which moves calamity spending onto the balance-of-payments line
RISK
- ▼Import cover 5.86mo on the Mar read — lowest since Feb 2026 (5.3 then) — with the barrel still above the $80 budget line
- ▼Exports flat at $4.03bn and remittance flat for twelve prints — neither side of the cushion is growing
- ▼Reserves held at $34.55bn by borrowing rather than by earning, on a 1 May-dated print
For the first time in this run the outflow side gave something back. Brent eased $1.85 to $89.11 and WTI $1.43 to $82.63 — a premium decaying, not a shock reversing, because $89.11 still sits $9.11 above the $80 line FY27's import and subsidy math was written against. The exchange rate did not move and will not: 122.85 for a third session. What absorbs the difference is the $1.05bn a month between a $1.77bn trade gap and $2.82bn of remittance, and that margin has not grown in twelve prints while the bill it covers has. The IMF now puts climate-related spending onto the balance-of-payments line as well, which is the same account. Price FX-linked exposure off the cushion, not off the peg, and treat one softer oil print as the moment to buy cover rather than evidence to stop. Energy importers should be hedging into the give-back.
DSE Markets
DSEX adds 1.9pt; breadth turns while turnover thins to Tk967cr.
DSEX Index
DSEX closed 5,857.62, up 0.03% — breadth turned to 148 advancing against 182 falling, but turnover fell to Tk967cr.
Nine prints since the 9 Jul reopen: 5,804 to a 5,926 high, then back to 5,858.
Equity desk: price steadied on falling volume — wait for turnover back above Tk1,070cr before treating 5,804 as a floor.
WATCH
- ◆Whether 5,804 — the 9 Jul reopen level — is ever tested; the index has held above it for nine prints
- ◆Whether eased margin-loan rules lift turnover off Tk967cr or merely lift leverage
- ◆Bank scrip against a Tk9,367cr provision gap BSEC has just put on a quarterly disclosure clock
RISK
- ▼Turnover down a second session while price stabilises — the bid is thinning, not returning
- ▼A bank-heavy float carrying a Tk9,367cr provision gap and a 32.26% NPL ratio on the Q1 2026 print
- ▼Looser margin rules adding leverage to a tape that traded Tk967cr
T-Bonds & T-Bills
182d clears 9.79%, above the 364d — supply repriced the belly.
BD Govt Yield Ladder
182d cut-off jumped 39bp to 9.79% and 91d 13bp to 9.30%, while the 364d held 9.57% and the 10y 10.24%.
The 182d printed 9.40% at the last seven consecutive auctions; the 364d has held 9.57% for eight.
ALCO: six-month paper now yields above twelve-month — fund short, buy the hump, defer duration to the next auction.
WATCH
- ◆Whether the next auction confirms 9.79% at six months or the 39bp jump was a one-auction supply clear
- ◆The 364d at 9.57%, unmoved for eight prints while the 182d cleared straight through it
- ◆The 10y at 10.24% — unchanged through the entire front-end backup
RISK
- ▼Negative carry on the front book — 182d paper at 9.79% against a 364d asset at 9.57%
- ▼Duration marks if the long end follows the belly, with 5s10s already compressed to 45bp
- ▼FY27 gross supply staying onshore and repeating the 39bp clear at each subsequent auction
An inverted bill curve is a supply signal, not a rate signal. The 182d cleared 9.79% against 9.40% at each of the last seven auctions — 39bp in a single print — while the 364d sat unmoved at 9.57% for an eighth. Six-month paper now yields 22bp more than twelve-month paper, which no view on inflation or policy explains. What explains it is the borrower: FY27 issuance is landing at the tenor banks will actually take, and the clearing level is set by how much the primary dealers want, not by where the policy rate sits. The 91d moved 13bp to 9.30% on the same logic. The 5y backed up 11bp to 9.79% while the 10y held 10.24%, so 5s10s has compressed to 45bp — the long end has not been asked to absorb anything yet. Fund short, take the six-month hump, and add duration only when an auction defends 10.24%.
Macro & Inflation
On the Mar prints CPI held 8.6%; credit stuck at 6.03%.
CPI Trend
CPI 12m-avg held 8.6% on the Mar print — food 8.24%, non-food 9.09% — disinflation has flattened rather than resumed.
The 12m-avg is lowest since Mar 2023 (8.4% then), with food lowest since Dec 2025 (7.7% then).
MPC: with the real policy rate at 1.29% and credit at 6.03%, the next MPS holds — a cost shock and no demand.
WATCH
- ◆The next CPI print, the first to carry a barrel above $80 into a non-food line already at 9.09%
- ◆Private credit at 6.03% — whether the Mar print breaks the 60-period low or confirms it
- ◆Import cover 5.86mo on the Mar read against a fuel bill still priced $9.11 above the FY27 line
RISK
- ▼Cash hoarding up 34% draining the deposit base that M2 growth of 10.52% is supposed to represent
- ▼Real policy rate at 1.29% — lowest since Feb 2026 (0.9% then) — leaving little room to cut before it turns negative
- ▼REER (Real Effective Exchange Rate) at 102.78 keeping the taka dear in real terms while monthly exports hold flat at $4.03bn
Remittance
Remittance holds $2.82bn for a twelfth print; cover stays $1.05bn.
Remittance Inflow
WATCH
- ◆The next monthly print — whether $2.82bn is a floor or the top of a slide
- ◆Cash hoarding up 34% — confidence in the formal channel is what routes this line through banks
- ◆How much of the $1.05bn cushion the next trade print gives up to fuel at $89.11
RISK
- ▼Twelve flat prints — the line is not growing while the bill it funds is
- ▼Gulf channel capacity re-routing informal, outside BB's count
- ▼A single fuel-heavy month turning the $1.05bn cover negative
Commodities
Gold back through $4,000 at $4,004.60; LNG still stale at $15.
WATCH
- ◆Whether gold holds $4,000 or follows crude lower on a genuine de-escalation
- ◆LNG spot against a 20 Apr $15/MMBtu print — three months stale into peak power demand
- ◆Food import lines against the safety-registration regime announced today
RISK
- ▼An LNG print landing well above $15/MMBtu into the same import month as $89.11 Brent
- ▼Food and energy import lines bidding for the same $1.05bn monthly cushion
- ▼Pass-through into a non-food CPI line at 9.09% on the Mar print
Fiscal
NBR stuck at Tk3.61tn as six-month funding clears 39bp higher.
NBR Tax Revenue
Monthly NBR collection has printed flat across the whole window, holding the YTD line at Tk3.61tn with no new receipt landing.
Fourteen prints in the window, all at Tk3.61tn — the last new monthly figure predates the window entirely.
Treasury: with the 182d clearing 9.79%, FY27's funding cost is rising while the revenue line is frozen.
WATCH
- ◆The next monthly NBR print — the Tk3.61tn level has not moved across the whole window
- ◆Whether the 182d clearing 9.79%, up 39bp, repeats at the next FY27 auction and reprices the domestic borrowing programme
- ◆Whether the IMF review turns calamity spending into a financed line or an unfunded one
RISK
- ▼A 39bp jump in six-month funding cost landing on an FY27 domestic borrowing programme still ramping
- ▼Revenue frozen at Tk3.61tn while the FY27 target steps up
- ▼Post-LDC targets underwritten by investment that is not arriving
Iran War & Oil
Brent eases to $89.11; still $9.11 above the FY27 line.
Brent Crude
Brent eased $1.85 to $89.11 and WTI $1.43 to $82.63 — the first fall of the run, spread now $6.48.
Brent still sits $9.11 above the $80 line underwriting FY27's oil math, one session after peaking at $90.96.
Treasury: hedge energy lines into the give-back — the import bill still prices $9.11 above budget.
WATCH
- ◆Whether $89.11 is a fade or a pause — the run to $90.96 built over a week
- ◆Energy-import LC volumes at the six-month funding point, now clearing 9.79%
- ◆The FY27 subsidy provision against a spot price still $9.11 above its $80 assumption
RISK
- ▼A rebuild of the premium landing on the same $1.05bn monthly cushion
- ▼Pass-through into a non-food CPI line at 9.09% on the Mar print
- ▼Energy-importer receivables stretching before the price relief reaches the payments data
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