Bangladesh’s economy has started showing signs of recovery, but high inflation, weak private investment and sluggish credit growth remain major challenges, the Metropolitan Chamber of Commerce and Industry (MCCI) said.
The chamber also identified weaknesses in the banking sector and weak export growth as key concerns that need to be addressed to sustain the recovery.
The observations came in MCCI’s latest report, “Economic Situation of Bangladesh: April-June 2026.” unveiled on Monday.
According to the report, GDP growth rose to a provisional 4.14 percent in the 2025-26 fiscal year, from 3.49 percent a year earlier.
MCCI, however, said the growth rate remains well below Bangladesh’s long-term economic potential.
Inflation remains stubbornly high
Inflation eased marginally in June but remained above 9 percent.
Overall inflation fell to 9.16 percent in June from 9.42 percent in May. Food inflation also declined to 8.60 percent.
But prices of non-food items and fuel continue to squeeze consumers’ purchasing power, the report said.
MCCI said bringing inflation down should remain a key policy priority if the recovery is to gain momentum.
Remittance, reserves offer relief
The external sector has been a bright spot for the economy.
Bangladesh received $9.38 billion in remittances during April-June. Foreign exchange reserves also rose to $37.58 billion at the end of June, up from $34.48 billion a month earlier.
The improvement, however, has yet to translate into stronger export performance.
Export earnings rose to $4.19 billion in June, but total exports for 2025-26 grew by just 0.17 percent.
Exports stood at $48.38 billion in the year, compared with $48.30 billion in 2024-25.
Private credit remains weak
Sluggish private-sector credit points to continued weakness in domestic demand.
Private-sector credit grew by only 4.47 percent between June 2025 and June 2026, compared with 6.49 percent in the same period a year earlier.
In contrast, credit to the government sector surged 30.43 percent during the period.
MCCI said reviving private investment and increasing the flow of credit to businesses will be crucial for a stronger recovery.
Revenue, development spending under pressure
The government also faced pressure on revenue collection and development spending.
The National Board of Revenue collected Tk 415,473 crore in 2025-26, falling Tk 87,527 crore short of the revised target of Tk 503,000 crore.
The shortfall was 17.40 percent.
Implementation of the revised Annual Development Programme fell to 67.52 percent, the lowest level in a decade.
FDI falls, trade deficit widens
The balance of payments recorded a surplus of $6.61 billion in 2025-26, reflecting improved external stability.
But the trade deficit widened sharply.
It rose 33.76 percent to $27.29 billion during the fiscal year.
Net foreign direct investment also fell 15.02 percent to $1.465 billion.
MCCI said the figures show that while some signs of economic stabilisation have emerged, the recovery remains fragile.
To make the recovery sustainable, Bangladesh must bring down inflation, strengthen the banking sector, revive private investment and credit growth, restore export momentum and maintain stability in the external sector, the chamber said.