Headlines
Crude bounced above $80 as the gas crunch idled a fifth of RMG.
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)
Call money held 9.48% all week; the belly premium stays gone.
FX Reserves
WATCH
- ◆Whether O/N and 14-day call hold ≤9.50% or month-end demand rebuilds the belly premium
- ◆The overdue reserves refresh past the 1 Jun $37.58bn read
- ◆Deposit-rate pass-through as July's yields-dive flows into term funding
RISK
- ▼The 7-day's 11.95% dislocation spreading if a single lender's funding gap widens
- ▼Rate relief landing into 33-year-low 4.98% credit demand — the cut fails to transmit
- ▼A real policy rate of 0.82% on the June read leaving a thin carry cushion post-cut
Banking
Q1 NPL frozen at 32.26% all week; the credit engine is demand-starved.
WATCH
- ◆Whether Q2 2026 statements finally land the court-stayed loan overhang on BSEC's quarterly clock
- ◆Any Q2 CAR disclosure superseding the 1.56% Q3 2025 read
- ◆RMG-linked exposure as the gas crunch idles a fifth of garment capacity
RISK
- ▼The credit impulse dead at a 33-year-low 4.98% — weak sheets cannot out-grow their NPL stock
- ▼Gas-driven factory closures pushing fresh RMG delinquency into the next NPL print
- ▼Court-stayed loan stock understating the printed 32.26% NPL ratio
The banking book closed the week where it opened — frozen on last quarter's prints while new pressure arrives through the real economy. NPLs hold 32.26% on the Q1 2026 read; system CAR (Capital Adequacy Ratio) sits at 1.56% on the Q3 read, 844bp below the 10% floor — a cushion gone, not thin. The live signal was demand: private credit held 4.98%, a 33-year low, so even solvent lenders face a shrinking book. Layer the week's supply shock — a fifth of garment factories on a three-day break as the gas crunch idles capacity — onto RMG exposure, and the next delinquency wave is a real-economy story, not a policy one. Rate relief is real — call money held 9.48% all week — but useless here: cheaper funding cannot repair a sheet with no borrowers. Dispersion stays the trade — own the private compounders that carry a lean quarter, fade the SCB (state-owned commercial bank) scrip that cannot.
FX & External
Taka steady at 123.82 all week; Friday's crude bounce lifts the import bill.
External Flow Balance
Trade gap held $1.77bn all week — exports $4.03bn, remittance $2.82bn — while USD/BDT steadied at 123.82 and Brent rebounded above $80 to $82.70.
USD/BDT broke its fourteen-print 122.85 hold to 123.82 in late July; reserves $37.58bn on the 30 Jun read.
Treasury: Friday's crude bounce reverses the week's import-bill relief — watch the overdue reserve print as remittance and RMG both cool.
WATCH
- ◆Whether 123.82 holds or the taka resumes its crawl as foreign financing thins
- ◆The overdue reserves refresh past the 30 Jun $37.58bn read
- ◆Whether Brent holds above $80 or Friday's Hormuz bounce fades
RISK
- ▼Friday's crude reversal to $82.70 re-widening the import bill it had been trimming
- ▼Record $4.49bn external debt repayment bidding for the same FX the $1.77bn trade gap consumes
- ▼Overseas job departures at a five-year low thinning the forward remittance that funds the peg
The peg's funding math held all week, but its inputs quietly deteriorated — and Friday flipped the one tailwind. USD/BDT sat at 123.82 across five sessions; reserves $37.58bn on the 30 Jun read keep import cover near 6.48mo, comfortable if aging. The week's relief was crude: Brent had slid under $80 by Thursday, lightening the import bill just as inflows softened. Then Friday reversed it — Brent back to $82.70, +$3.25, as gold hit a seven-week peak on resurfacing Gulf risk. Both offsetting legs are cooling: July exports slipped 0.9% YoY as a fifth of garment factories idle on the gas crunch, and overseas job departures hit a five-year low. The $2.82bn July inflow still clears the $1.77bn trade gap, but the margin has stopped growing. Treasury: hold the constructive stance, but guard the buffer — Friday's crude bounce removed the free lunch.
DSE Markets
DSEX pinned ~5,894 all week; weak breadth sheds Tk2,534cr beneath a flat index.
DSEX Index
DSEX held ~5,894 all week, capped below 5,900 — a 5,784 low to 5,900 high band; breadth negative 170/176 on Tk1,111cr turnover.
Ten prints bracketed by a 5,784 low and a 5,900 high; the cap has not broken all window.
Equity desk: a flat index masking negative breadth — stay selective until 5,900 breaks on volume.
WATCH
- ◆Whether the post-holiday reopen finally clears 5,900 or the cap holds again
- ◆Turnover follow-through — a slip under Tk1,000cr confirms fading conviction
- ◆Bank scrip as private credit prints a 33-year-low 4.98% and NPLs hold 32.26%
RISK
- ▼The late-week sell-off — Tk2,534cr of market cap shed — repricing float into the reopen
- ▼The gas-driven garment break repricing RMG and industrial earnings
- ▼A thin-conviction tape fading on negative breadth into the post-holiday reopen
T-Bonds & T-Bills
Front held near policy all week — 364d 9.54%; July's spike stays unwound.
BD Govt Yield Ladder
The front held July's unwind all week — 364d 9.54%, 182d 9.53%, 91d 9.30% — while the 10y sat at 10.24%.
The 364d ran 10.09% for six prints after its July jump, then cut 55bp to 9.535%, held four prints since.
ALCO: price term funding to the auction, not the July spike — lock relief before deposit rates catch down.
WATCH
- ◆Whether the next auction holds the front near 9.50% or cuts further below policy
- ◆The 10y at 10.24% — whether FY27 duration supply cheapens it off the level
- ◆5s10s at 56bp — the slope repricing long-dated fixed-rate books
RISK
- ▼The front collapse signalling weak credit demand — 33-year-low 4.98% private growth — not just liquidity
- ▼Deposit and lending rates lagging the bill-curve drop, squeezing bank margins
- ▼Long-end supply into a thin FY27 auction calendar steepening 5s10s from 56bp
Macro & Inflation
Private credit stuck at a 33-year-low 4.98%; June non-food CPI firm at 9.61%.
CPI Trend
June point-to-point inflation held firm — non-food 9.61%, food 8.6% — while the 12m-avg sat at 8.6% on the older March print.
The 12m-avg is lowest since Mar 2023 (8.4% then) — a March read; the June point-to-point is firming again.
MPC: with June non-food 9.61% and the August LPG hike not yet in the base, hold before easing.
WATCH
- ◆The next CPI print — first to carry the August LPG hike into the 9.61% June non-food line
- ◆Private credit at 4.98% — whether the print marks a floor or extends the slide
- ◆Import cover 6.48mo on the June read — whether the overdue reserve print holds it
RISK
- ▼June non-food inflation at 9.61% firming as the August LPG hike compounds the next cost-push print
- ▼Private credit at a 33-year-low 4.98% with M2 10.52% (Feb) — liquidity present, demand absent
- ▼A real policy rate of 0.82% on the June read leaving a thin carry cushion post-cut
Remittance
July remittance held $2.82bn all week; the migration pipeline is cooling.
Remittance Inflow
WATCH
- ◆Whether $2.82bn is a floor or the top of a slide after a second month under $3bn
- ◆Overseas jobs at a five-year low — how fast the departure slowdown feeds monthly inflow
- ◆BB's new PayPal, Payoneer-style rails — a structural add to the inflow channel
RISK
- ▼Overseas job departures at a five-year low signalling a thinner remittance pipeline in coming quarters
- ▼The line's cushion bidding against a record $4.49bn external repayment
- ▼Friday's crude bounce re-widening the import bill this inflow must clear
Fiscal
NBR held Tk3.61tn all week; FY26 tax-return filing hit a multi-year low.
NBR Tax Revenue
Monthly NBR collection printed flat again all week, holding the YTD line at Tk3.61tn — no new receipt across the fourteen-print window.
Fourteen prints, all Tk3.61tn — the last new monthly figure predates the window.
Treasury: revenue frozen, but the FY27 gap funds cheaper — onshore clears at a 364d 9.54%, ~55bp below July's spike.
WATCH
- ◆The next monthly NBR print — the Tk3.61tn line has not moved all window
- ◆FY26 tax-return filing at a multi-year low — whether the receipt base keeps eroding
- ◆Whether the 364d stays near 9.54% into the FY27 issuance calendar
RISK
- ▼A thin revenue base carrying the FY27 gap as tax-return filing hits a multi-year low
- ▼Gas-driven factory closures denting VAT and income receipts into the next NBR print
- ▼The bill-curve relief reversing if issuance supply outruns the demand shortfall
Iran War & Oil
Brent bounced to $82.70 by Friday, back above the $80 FY27 line.
Brent Crude
Brent whipsawed — down to $79.45 by Thursday, back to $82.70 on Friday, +$3.25; WTI $77.59, the Brent-WTI spread near $5.11.
Brent now sits $2.70 above the $80 FY27 line, $0.55 under it Thursday, $10 over a fortnight ago.
Treasury: the import bill re-crosses above the FY27 assumption — watch the subsidy line and energy-importer credit into the gas crunch.
WATCH
- ◆Whether Brent holds above $80 or Friday's Hormuz bounce fades back under the FY27 line
- ◆The FY27 subsidy provision now that spot Brent has re-crossed its $80 assumption
- ◆The August LPG hike feeding energy cost-push into the June 9.61% non-food line
RISK
- ▼A renewed Gulf escalation snapping Brent toward the $90 seen a fortnight ago and re-widening the import bill
- ▼A domestic gas-supply shortfall forcing costlier spot LNG as factories idle
- ▼The August LPG hike compounding the firm 9.61% June non-food CPI line
Crude was the week's only real mover, and it whipsawed. Brent eased early toward the sub-$80 relief that defined Thursday — $79.45, the war premium unwound from a $10 gap a fortnight ago — then reversed hard on Friday, back to $82.70, +$3.25, as gold touched a seven-week peak on resurfacing Strait of Hormuz risk. WTI tracked to $77.59, the Brent-WTI spread near $5.11. The consequence for Bangladesh is direct: at $79.45 the import bill and the FY27 subsidy line sat below assumption; at $82.70 Brent is $2.70 back above the $80 FY27 marker, and the relief lightening the FX drain is unwinding into a gas crunch forcing costlier spot LNG. Treasury: do not bank Thursday's crude dividend — the week closed with the premium creeping back, the August LPG hike still ahead of the June 9.61% non-food print. Watch whether Monday confirms the bounce or fades it.
Every morning.
Free.