Headlines
The energy crunch dominates — LNG at a premium, power cuts, shortened hours.
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)
Overnight eases to 9.33% inside policy; the 14-day stays 11.50%, term tight.
FX Reserves
WATCH
- ◆Whether the 14-day's 11.50% is month-end tightness or term funding rebuilding above the SLF ceiling
- ◆The overdue July reserve print — the FX buffer behind the front unverified
- ◆Deposit-rate pass-through as the bill-curve drop flows into term funding
RISK
- ▼Term funding trading above the SLF ceiling while the front eases — a fractured corridor
- ▼Rate relief landing into a 33-year-low 4.98% private credit — the cut failing to transmit
- ▼A razor-thin real policy rate on the Jun read leaving little carry cushion post-cut
Banking
Book frozen on Q1's 32.26% NPL; CAR 844bp below the floor.
WATCH
- ◆Q2 2026 NPL disclosure finally landing the court-stayed loan overhang
- ◆Whether the Bank Resolution Act accelerates SCB (state-owned commercial bank) recapitalisation or forbearance
- ◆Private credit at 4.98% — whether the 30 July cut revives borrowing
RISK
- ▼Private credit at a 33-year-low 4.98% — weak sheets cannot out-grow their NPL stock
- ▼Court-stayed loan stock understating the printed 32.26% NPL ratio
- ▼SCB recap risk crystallising under the new resolution regime
The banking book is frozen on last quarter's prints, and the freeze is the story. NPLs sit at 32.26% on the Q1 2026 read, system CAR at 1.56% on the Q3 2025 read — 844bp below the 10% floor, a cushion gone, not thin. Neither has moved, and neither will until Q2 disclosure lands the court-stayed loan overhang that already understates the printed ratio. The resolution machinery keeps hardening around the frozen book — the Bank Resolution (Amendment) Act now in statute — but the transmission problem is unchanged: cheaper funding after the 30 July cut cannot revive a book with no borrowers, and private credit sits at a 33-year-low 4.98%. The money is there; demand is not. Dispersion stays the trade — own the private compounders that survive a lean quarter, fade the SCB paper the new regime tests first.
FX & External
Taka firms to 123.48; reserves hold $36.42bn on the July print, gold near $4,476.
External Flow Balance
USD/BDT firmed to 123.48 from 123.64; July flows held — exports $4.03bn, trade gap -$1.77bn — while reserves stayed $36.42bn.
Reserves on the 31 Jul print, import cover 6.28mo — the July level still awaits an August refresh.
Treasury: the taka firmed but on a thin buffer — watch the peg at 123.48 and the reserve refresh as Brent tests $90.
WATCH
- ◆Whether 123.48 holds or the taka resumes its crawl as Brent re-widens the bill
- ◆The reserve trajectory past the $36.42bn 31 Jul print
- ◆Gold at $4,475.90 — whether the safe-haven bid signals wider risk-off
RISK
- ▼Brent near $90 and freight re-widening the import bill remittance must clear
- ▼Reserves drawing down while earned dollars stay soft
- ▼The $1.77bn trade gap widening if the energy bill climbs
DSE Markets
DSEX slips to 5,897 below 5,900; breadth turns 119/231, turnover holds.
DSEX Index
DSEX slipped 0.11% to 5,897.27, back below the 5,900 line; turnover held Tk1,074cr, breadth 119 up to 231 down.
Yesterday cleared 5,900 to 5,903.53 on Tk1,115cr; today's first retest fails back inside the range.
Equity desk: the breadth flip warns the breakout lacks follow-through — fade unless turnover holds above Tk1,000cr into a reclaim of 5,900.
WATCH
- ◆Whether DSEX reclaims 5,900 or the retest confirms a failed breakout back into the 5,822–5,903 range
- ◆Turnover holding above Tk1,000cr — the line separating accumulation from a one-day spike
- ◆Bank and NBFI scrip as the resolution regime reprices financial float
RISK
- ▼A failed breakout below 5,900 turning yesterday's move into a bull trap
- ▼Brent near $90 and the energy crunch repricing gas-exposed industrial earnings
- ▼Turnover slipping back under Tk1,000cr, draining the breakout of conviction
One session does not break a trend, but it tests one. Yesterday DSEX cleared the 5,900 top it had probed for eleven sessions, and the move carried the Tk1,115cr turnover the two prior failed attempts lacked. Today it gave part of that back — DSEX eased 0.11% to 5,897.27, just under 5,900 — and breadth flipped hard: 119 advancers against 231 decliners, a near-mirror of yesterday's 242/101. What held is turnover, above Tk1,000cr at Tk1,074cr. Index consolidating, volume sustained, breadth soft — that is the signature of a liquidity tape, not an earnings one: with private credit dead at 4.98% and M2 up 10.52% on the Feb read, idle money is rotating into the index for want of anywhere to lend. The desk fades the breakout until DSEX reclaims 5,900 on positive breadth — a liquidity rally that loses breadth is a bull trap, however heavy the turnover.
T-Bonds & T-Bills
Bill front steady below policy; the 5y richens to 9.35%, 5s10s to ~90bp.
BD Govt Yield Ladder
The front held below policy — 91d 9.19%, 182d 9.32%, 364d 9.33% — while the 5y rallied to 9.35% from 9.79%, the 10y at 10.25%.
The 364d stepped 10.09% to 9.535% to 9.33% over the window; the 5y round-tripped 9.68% to 9.79% to 9.35%.
ALCO: 5s10s steepens to ~90bp as the belly richens — price term funding to the stable front, watch belly supply.
WATCH
- ◆Whether the 5y holds 9.35% or the belly cheapens again on FY27 supply
- ◆The next auction — whether the front resumes cutting or holds below policy
- ◆5s10s near 90bp — the slope repricing long-dated fixed-rate books
RISK
- ▼Belly volatility — the 5y round-tripping 44bp in two sessions signals thin depth
- ▼The falling front signalling weak credit demand, not just easy liquidity
- ▼Deposit and lending rates lagging the bill-curve, squeezing bank margins
Macro & Inflation
Private credit at a 33-year-low 4.98%; real policy rate razor-thin on the Jun read.
CPI Trend
The CPI 12m-avg held 8.68% on the Jun print; food inflation 8.6%, non-food 9.61% — the trailing read still elevated.
Highest since Dec 2025 (8.8% then) — the trailing average sitting above the 8.6% monthly food print.
MPC: the trailing average still elevated while monthly food sits at 8.6% — hold before easing.
WATCH
- ◆The next 12m-avg print — whether the monthly turn pulls the trailing average down
- ◆Private credit at 4.98% — whether the 30 July cut revives borrowing
- ◆Brent near $90 and the August cooking-gas hike feeding cost-push into the next CPI print
RISK
- ▼Private credit at a 33-year-low 4.98% with M2 10.52% on the Feb read — liquidity present, demand absent
- ▼A razor-thin 0.34% real policy rate on the Jun read leaving no carry cushion
- ▼The August cooking-gas hike and Brent near $90 compounding cost-push into the next print
Remittance
July held $2.82bn, a second month under $3bn as the buffer drains.
Remittance Inflow
WATCH
- ◆Whether $2.82bn is a floor or the top of a slide after a second month under $3bn
- ◆The reserve trajectory past the $36.42bn 31 Jul print
- ◆Brent near $90 re-widening the import bill the inflow must clear
RISK
- ▼Earned dollars softening while reserves draw and the energy bill climbs
- ▼Brent near $90 stacking onto the import bill this inflow must clear
- ▼The margin over the $1.77bn trade gap no longer growing
Fiscal
NBR frozen at Tk3.61tn; Brent near $90 reopens the FY27 fuel-subsidy gap.
NBR Tax Revenue
Monthly NBR collection printed flat again, 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 while a costly US LNG cargo and Brent at $88.79 widen the FY27 gap.
WATCH
- ◆The next monthly NBR print — the Tk3.61tn line has not moved all window
- ◆Whether Brent near $90 forces a wider FY27 fuel-subsidy provision
- ◆The US LNG purchase — whether it lands as bank borrowing or budget subsidy
RISK
- ▼A thin revenue base carrying the FY27 gap as receipts stall at Tk3.61tn
- ▼Brent near $90 reopening the fuel-subsidy gap the FY27 budget set at $80
- ▼Govt bank borrowing crowding private credit already at a 33-year-low 4.98%
Iran War & Oil
Brent holds $88.79, WTI $83.09 — still $8.79 above the $80 FY27 line.
Brent Crude
Brent held $88.79, WTI $83.09 — the spread near $5.70 — crude shadowing $90, the war premium intact.
Brent $8.79 above the $80 FY27 line, off $88.93 a session ago and sub-$80 a fortnight back.
Treasury: each dollar of Brent widens the import bill and the FY27 subsidy claim — watch $90 and energy-importer receivables.
WATCH
- ◆Whether Brent breaks $90 or the war premium fades toward the $80 FY27 line
- ◆The FY27 fuel-subsidy provision with spot $8.79 over the $80 assumption
- ◆The US LNG purchase and power cuts — how the energy bill is financed
RISK
- ▼A Gulf escalation carrying Brent through $90 onto the import bill and the peg
- ▼Crude plus freight stacking onto a $1.77bn trade gap
- ▼The August cooking-gas hike and power cuts compounding energy cost-push into the next CPI print
The oil bid has stopped climbing but has not retreated, and for an energy importer the plateau is the problem. Brent held $88.79, WTI $83.09, the spread near $5.70 — $8.79 above the $80 the FY27 budget assumed, and the sub-$80 relief of a fortnight ago is fully unwound. The pressure is no longer a forecast; it is arriving. A US LNG cargo has been booked at a premium, power cuts are squeezing small-business output, and shopping hours have been shortened to ration supply — the crude line on the screen has become load-shedding on the ground. For the desk this reads three ways: a wider FY27 fuel-subsidy provision onto a revenue base frozen at Tk3.61tn; cost-push waiting to relight the inflation turn before it is confirmed; and a fresh claim on the same soft dollars the reserve buffer is already spending. Watch $90 — and watch the energy-importer receivables that reprice on the next refi cycle.
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