Headlines
Ownership reforms advance while a merged Islamic bank bleeds deposits.
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 9.50%; call money soft inside the band.
FX Reserves
Gross reserves reached $36.42bn as of the Jul 2026 print, up from $31.09bn last November and below the series peak of $37.58bn.
Up $5.33bn from the Nov 2025 series low of $31.09bn over the plotted window.
Treasury: the buffer has rebuilt off the November low, but the July stamp is aging — watch the next print before sizing import cover.
WATCH
- ◆Whether call money stays inside the 7.50–11.00% corridor
- ◆The next gross-reserve print against July's $36.42bn
RISK
- ▼A reserve refresh below $36.42bn tightening the import-cover math
- ▼Liquidity tightening if call money climbs toward the 11.00% SLF ceiling
Banking
NPLs at 32.78% on the Q2 print; stress concentrated in a few banks.
Overnight Money Market
BOFR (Bangladesh Overnight Financing Rate) eased to 9.18% as of the 8 Sep 2026 print, down from 10.42% in mid-April; DOMMR (Dhaka Overnight Money Market Rate) now 9.03%, off a 10.65% peak.
Down 124bp from the mid-April 10.42% start of the plotted window.
Treasury: overnight funding has cheapened since the July cut — supports carry, but watch DOMMR against the 7.50% SDF floor.
WATCH
- ◆Q3 2026 NPL disclosure for direction off the 32.78% print
- ◆Deposit stability at merged and Islamic banks after the BDT 1,040cr Sammilito outflow
RISK
- ▼Provisioning gap widening as NPLs concentrate in ten banks
- ▼Deposit flight from stressed banks pressuring system liquidity
- ▼CAR clarity pending — the 1.56% Q3 2025 read is stale
Bangladesh's non-performing loan ratio was 32.78% in the Q2 2026 print, and the newsworthy detail is not the headline level but its distribution: ten banks account for 72% of the bad-loan stock. When default risk sits in a handful of balance sheets, the system's stability depends on the recapitalisation and resolution path for those specific institutions rather than on broad sector averages. Parliament's move to scrap the contested ownership provision and to bar former owners from returning to merged banks reshapes that path, and the BDT 1,040cr withdrawn from Sammilito Islami Bank over three days shows depositors are already repricing counterparty risk at the weaker names. For the desk, the read is a widening split between strong and weak banks: interbank exposure to the concentrated names warrants tighter limits, and the capital picture stays opaque while the system figure rests on a Q3 2025 print at 1.56%.
FX & External
Taka firm at 122.79; external cover rests on aging June and July prints.
External Flow Balance
Imports hit a series-high $7.51bn as of Jun 2026; exports $4.20bn, up from $3.35bn a year earlier — the gap widens.
Exports up 25% on Jun 2025's $3.35bn; imports at a 24-month high over the plotted window.
Treasury: the trade drain persists — remittance and export gains fund the gap, but reserve cover depends on the next print.
WATCH
- ◆The next reserve print against July's $36.42bn
- ◆Whether monthly exports hold the $4.20bn June pace
- ◆USD/BDT stability around 122.79 into quarter-end
RISK
- ▼Trade gap widening beyond June's $3.31bn if imports stay near $7.51bn
- ▼Reserve cover slipping below 4.85 months on the next refresh
The external account is holding together on two inflows against one persistent drain. On the drain side, the June trade gap was $3.31bn, with imports at $7.51bn running well ahead of exports at $4.20bn, and gross reserves have not refreshed since the July $36.42bn print — leaving import cover at roughly 4.85 months on June data. On the inflow side, exports were up from $3.35bn a year earlier and the August remittance flash of $2.97bn extends a run of strong worker inflows. The taka has sat at 122.79, which tells the desk Bangladesh Bank is comfortable defending the level while remittance funds the gap. The exposure is timing: the reserve and trade prints are two to six weeks old, so the buffer behind a stable rate is being read off data that predates the current quarter. Position FX cover conservatively until the next reserve print confirms the July level.
DSE Markets
DSEX at 5,539 on the 8 Sep close, near a 57-session low.
DSEX Index
DSEX at 5,539.32 as of the 8 Sep 2026 print — near flat on the year (5,473.15), inside a 12-month 4,703–5,926 range.
The 8 Sep close was a 57-session low (5,520.40 on 11 Jun the last lower close).
Equity desk: the index is grinding toward yearly-range lows on light volume — watch the June low as support before adding risk.
WATCH
- ◆Whether the DSEX holds the 5,520.40 June low
- ◆Turnover recovering above BDT 590cr as a conviction signal
RISK
- ▼A break below the 11 Jun 5,520.40 low opening further downside
- ▼Persistent thin turnover signalling sidelined liquidity
T-Bonds & T-Bills
Bill yields fell at the 7 Sep auction; bonds steady on the Aug read.
BD Govt Yield Ladder
Yields fell across the curve since Jul 2026 — the 91-day from 9.79% to 8.59%, the 10-year from 10.24% to 9.23% by the Sep print.
A broad front-to-long decline over three monthly prints, Jul to Sep 2026.
Treasury: the July cut has pulled the whole curve lower — supports bond carry, expect issuance costs to fall at the next auction.
WATCH
- ◆Whether the front-end rally extends below 8.59% at the next bill auction
- ◆The next 5y/10y print off the 21 Aug 9.15%/9.23% marks
RISK
- ▼Front-end easing reversing if government borrowing needs rise
- ▼Duration mismatch on long-dated fixed books if the long end reprices
Macro & Inflation
12m CPI at 8.66% on the Jul print; real policy rate just 1.18%.
CPI Trend
The 12-month average CPI eased to 8.66% by the Jul 2026 print, down from 9.77% a year earlier and 9.95% at the series start.
Near the series low of 8.59% over 24 months; down from 9.95% at the Aug 2024 start.
Treasury: disinflation is real but slow — with the real rate at 1.18%, expect Bangladesh Bank to hold rather than cut further.
WATCH
- ◆August CPI for whether the 12m average breaks below 8%
- ◆Private credit off the 4.98% August print for demand signals
- ◆M2 momentum after the Jun 11.11% — highest since Sep 2021
RISK
- ▼Non-food inflation at 9.28% keeping the real rate thin
- ▼Weak private credit at 4.98% signalling soft investment demand
- ▼M2 acceleration feeding back into price pressure
Remittance
August remittance flash at $2.97bn, up ~23% on a year ago.
Remittance Inflow
Monthly remittance was $2.86bn as of the Jul 2026 print, up from $2.42bn a year earlier, within a 12-month range of $2.42bn to $3.76bn.
Up from the $2.42bn series low of Aug 2025 over the plotted 12 months.
Treasury: worker inflows are funding the external gap — the runway holds while remittance stays near $2.9bn a month.
WATCH
- ◆Whether the August $2.97bn flash holds on final revision
- ◆September inflows for confirmation of the run rate
- ◆USD/BDT stability at 122.79 as remittance funds the gap
RISK
- ▼Provisional flash revising below $2.97bn on final data
- ▼A seasonal fade after the strong summer inflow run
- ▼Reserve cover exposure if remittance softens into the trade gap
Remittance is the load-bearing inflow on Bangladesh's external account, and the August flash of $2.97bn — up about 22.6% on the $2.42bn of a year earlier — extends a run of strong worker inflows just as the buffer needs it. The mechanism is straightforward: the June trade gap was $3.31bn, with imports at $7.51bn well ahead of exports at $4.20bn, and gross reserves have not refreshed since the July $36.42bn print. Remittance fills that gap and lets Bangladesh Bank hold the taka at 122.79 without drawing reserves down. For the desk, FX stability is currently a function of worker inflows rather than the trade balance or the reserve stock. The exposure is that August is a provisional flash — a downward revision or a seasonal fade would put the weight back on a reserve buffer read off two-month-old data. Stay constructive on the runway while the inflow holds; size FX cover to the flash's provisional status.
Fiscal
NBR at BDT 4.15tn YTD; bank borrowing light on the June read.
NBR Tax Revenue
Monthly NBR revenue was BDT 28,027cr as of the Oct 2025 print, up from BDT 26,555cr a year earlier and BDT 22,005cr at the series start.
Up 5.5% on Oct 2024's BDT 26,555cr; monthly take ranged BDT 21,478cr to BDT 52,720cr over the run.
Fiscal: revenue momentum is positive but modest — watch whether the run rate lifts collection enough to cap bank borrowing.
WATCH
- ◆The next NBR update against the BDT 4.15tn YTD mark
- ◆Whether government bank borrowing rises above the June BDT 0.94tn
RISK
- ▼A revenue shortfall forcing heavier bank borrowing later in FY
- ▼Crowding-out of private credit if government borrowing accelerates
Iran War & Oil
Brent at $98.63 pressures the import bill and fuel subsidy math.
Brent Crude
Brent rose to $98.63/bbl as of the 8 Sep 2026 print, up from $88.54 in mid-June and just below the $100.38 series high.
Up from the $71.18 low of the window; near the $100.38 peak since mid-Jun 2026.
Treasury: elevated crude keeps import-bill and subsidy pressure on — watch energy-sector receivables and the trade gap on the next print.
WATCH
- ◆Brent holding above the recent range if supply risk persists
- ◆Pass-through to the next import bill and fuel-subsidy line
RISK
- ▼Higher crude widening the trade gap beyond June's $3.31bn
- ▼Imported-inflation risk stalling the CPI disinflation trend
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