Headlines
External flows are firming; the gas crisis is the cost-side risk to watch.
The day's tape splits cleanly. On the external line, August exports grew 13% on an RMG rebound and remittance came in at a reported $2.97bn, so the two non-debt inflows that rebuild reserves are both firm; gross reserves last read $36.42bn in the 31 Jul print and the taka held just under USD/BDT 123, holding import cover near 4.85 months. The standing caveat is asset quality: system NPLs at 32.26% on the Q1 2026 print, now paired with a new route to auction bad loans and indebted firms. The gas-supply warnings run through the cost side, not the FX line. For the desk, the external account reads constructive while banking stays the exposure to watch; the swing factor is the next reserve refresh.
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)
Corridor held at 9.5%; call money below policy signals easy liquidity.
FX Reserves
Gross reserves rose to $36.42bn by the Jul 2026 print from $31.09bn last November, still below the $37.58bn series peak.
Nine-month rebuild off the Nov 2025 low ($31.09bn then) toward the $37.58bn series peak.
Treasury: the rebuild underpins import cover near 4.85mo; watch the next reserve refresh to confirm the buffer behind the eased policy front.
WATCH
- ◆Next reserve refresh after the 31 Jul print
- ◆Call money drift toward the 7.5% SDF floor
RISK
- ▼Reserve print lags the eased-rate front by five weeks
- ▼Liquidity glut compressing deposit pricing
Banking
Asset quality stale near series highs; the auction route is the first fresh lever.
Overnight Money Market
DOMMR (Dhaka Overnight Money Market Rate) at 9.18% by the 27 Aug print — the low of its plotted range, down from 10.09% in mid-April.
Down close to a full point since the 15 Apr 2026 series start (10.09% then), tracking the eased corridor.
Treasury: overnight funding has settled about 30bp below the 9.5% policy rate, a comfortable interbank tone; short-tenor carry compresses as the curve re-rates lower.
WATCH
- ◆Q2 2026 NPL disclosure, still pending
- ◆Uptake of the new bad-loan auction route
RISK
- ▼NPL stock concentrated in state-owned commercial banks (SCBs)
- ▼Thin capital against a 32%+ NPL ratio
The banking chapter turns on two stale prints and one fresh rule. NPLs at 32.26% in the Q1 2026 read sit near the series high, and most of that stock is concentrated in a handful of state-owned commercial banks (SCBs), which puts the system's tail risk in a few balance sheets. Reported capital adequacy of 1.56% on the Q3 2025 print leaves little cushion, though both numbers are several quarters old and the next disclosure resets the picture. The new route allowing bad loans and indebted firms to be auctioned is the first fresh lever for resolution: clear even a slice of stuck stock and it lifts recovery values and frees provisioning capacity; if uptake stalls, nothing changes. With private credit growth at 4.98% and interbank rates near the floor, the binding constraint is capital and asset quality, not liquidity. Stay defensive on SCB counterparty lines and treat the auction route as optionality, not a turn.
FX & External
External flows firming; the import bill at a series high keeps the gap wide.
External Flow Balance
Exports hit $4.20bn in the Jun 2026 print, up 25% YoY from $3.35bn, while imports rose to a series-high $7.51bn.
Imports at their highest in the 24-month series (Jul 2024–Jun 2026); exports up from a $3.03bn low.
Treasury: the gap is covered by remittance ($2.86bn in the Jul print) and the reserve buffer; watch whether the August export rebound narrows it.
WATCH
- ◆August export and remittance releases confirming the rebound
- ◆Import bill after the Jun 2026 series-high $7.51bn
RISK
- ▼Import bill at a series high widening the trade gap
- ▼Reserve print 33 days stale behind an easing rate front
The external account is the day's cleaner story. Exports grew 13% in August on an RMG rebound, per today's release, extending a run that took the June print to $4.20bn, up 25% from a year earlier. Remittance is firming too — $2.86bn in the July print, with the reported August tally at $2.97bn — so the two non-debt inflows that refill reserves are both improving. Against that, the import bill rose to a series-high $7.51bn in June, holding the monthly trade gap near $3.31bn, and gross reserves read $36.42bn on the 31 Jul print, now 33 days old. Import cover sits near 4.85 months on June data — stable, not stretched. The mix argues for a steady taka near USD/BDT 123 and no near-term peg pressure; the live risk is a stale reserve print masking the true buffer. Stay neutral on USD/BDT and constructive on export-linked receivables.
DSE Markets
The index is flat over a year on thin turnover; range-bound, not trending.
DSEX Index
DSEX closed 5,655.68 on the 27 Aug print, up 0.6% over the year from 5,620.92, having ranged 4,703 to 5,926 in between.
A full round-trip: back near the 2 Sep 2025 level (5,620.92 then) after a low of 4,703.
For equity-linked exposure: the index is going nowhere on thin BDT 467cr turnover; treat DSE collateral marks as range-bound, not trending.
WATCH
- ◆Turnover recovery above the thin BDT 467cr level
- ◆Whether DSEX holds the 5,600 area it revisited
RISK
- ▼Thin liquidity amplifying marks on DSE-collateralised exposure
- ▼Flat-for-a-year index capping margin-loan valuations
T-Bonds & T-Bills
Bill cut-offs fell at the 24 Aug auction; the curve keeps re-rating lower.
BD Govt Yield Ladder
The curve shifted down about 100bp since June: 91d T-Bill 8.83% and 10y 9.23% on the Aug prints, from 9.44% and 10.24% in June.
A three-month slide, June to August 2026, across the whole ladder (91d from 9.44% to 8.83%).
Treasury: funding costs are re-rating lower with the eased corridor; roll shorter maturities before the next auction and expect further cut-off compression.
WATCH
- ◆Next T-Bill auction cut-offs after the 24 Aug sitting
- ◆Whether long bonds follow the bill-end lower
RISK
- ▼Reinvestment risk as cut-offs compress on rolls
- ▼ALM (Asset-Liability Management) margin squeeze on repricing assets
Macro & Inflation
Disinflation slow, real rate thin at 1.18%; M2 loose but credit not transmitting.
CPI Trend
CPI 12-month average eased to 8.66% by the Jul 2026 print, off a 10.34% series peak; food P2P down to 8.6% in June from 13.8%.
12m-avg near its 8.59% series low (Aug 2024–Jul 2026); M2 growth highest since Sep 2021 (11.2% then).
Treasury: with the repo at 9.5% and July P2P CPI at 8.32%, the real policy rate is barely positive at 1.18%; expect the MPC to hold.
WATCH
- ◆August CPI print for a break below 8.5%
- ◆Private credit response after M2 at a multi-year high
RISK
- ▼Non-food inflation sticky at 9.28% keeping the real rate thin
- ▼REER (Real Effective Exchange Rate) at 102.78 on the Mar print — highest since Nov 2025 (103.55 then)
Macro sends two signals that pull opposite ways. On prices, the 12-month average CPI is grinding lower — 8.66% in the July print, near its two-year low — and food P2P at 7.16% is well off the 13.8% series peak, so disinflation is real if unhurried. That leaves the real policy rate barely positive at 1.18%, off the 9.5% repo and July P2P CPI of 8.32%, giving the MPC room to hold. On quantities the picture is looser: M2 growth at 11.11% in the June print is the highest since Sep 2021 (11.2% then), yet private credit is stuck at 4.98% — money is being created but not reaching private borrowers, which points to government financing absorbing it. The REER at 102.78 on the March print leaves the taka firm in real terms while the nominal rate holds near 123. For the desk: real rates argue for a hold, and weak credit transmission says easing is not reaching borrowers.
Remittance
Remittance is holding well above last year; August pace firm on early counts.
Remittance Inflow
Remittance was $2.86bn in the Jul 2026 print, up from $2.42bn a year earlier, within a $2.42–3.76bn range over the year.
Up 18% from the $2.42bn a year earlier (Aug 2025 then), holding above the $2.4bn floor.
For FX runway: remittance plus the export rebound covers the June trade gap without new borrowing; watch the confirmed August print against the $2.82bn flash.
WATCH
- ◆Confirmed August remittance against the $2.82bn provisional flash
- ◆Whether the reported $2.97bn August pace holds into September
RISK
- ▼Provisional August flash revised on final count
- ▼Seasonal fade after the mid-year peak of $3.76bn
Fiscal
Revenue growth near 5% trails GDP; the budget leans on bank borrowing.
NBR Tax Revenue
Monthly NBR revenue was BDT 28,027cr in the Oct 2025 print, up 5.5% from BDT 26,555cr a year earlier.
Mid-range in the Jul 2023–Oct 2025 series, which spikes to BDT 52,720cr at fiscal year-ends.
Fiscal: revenue growth of about 5% lags nominal GDP, so the deficit leans on bank borrowing; watch government bank borrowing above the BDT 0.94tn Jun mark.
WATCH
- ◆Fresh NBR monthly revenue after the Oct 2025 series point
- ◆Government bank borrowing beyond the BDT 0.94tn Jun mark
RISK
- ▼Revenue growth trailing nominal GDP widening the deficit
- ▼Crowding-out as the budget leans on bank borrowing
Iran War & Oil
Brent under $90 drains the war premium; a modest tailwind for the import bill.
Brent Crude
Brent at $89.31, down from $97.09 in early June and off the $100.38 range high, though above the $71.18 low.
A three-month slide from the $97.09 early-June level (4 Jun 2026 start), holding a $71–100 band.
For energy-import credit lines: sub-$90 Brent eases the import bill and FX draw; watch receivables risk only if the band breaks $100 on a Gulf flare-up.
WATCH
- ◆Brent breaking the $100 range high on any Gulf escalation
- ◆Sub-$90 crude feeding through to the import bill
RISK
- ▼A supply shock lifting Brent back toward the $100 high
- ▼Import-bill relief reversing if the band breaks upward
Every morning.
Free.