BD Financial Review
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Economy & Policy

Bangladesh Scraps a Costly LNG Terminal Plan, Leans on China and Spot Cargoes to Keep the Gas Flowing

Bangladesh's cabinet has walked away from a planned floating LNG terminal at Kutubjom that would have cost up to Tk13,161 crore over 20 years, choosing instead to buy nine LNG cargoes on the spot and government to government markets. Days later, in Bangkok, a China Exim Bank delegation told the power minister it wants to speed up financing for Payra power plant's expansion and for grid upgrades around Dhaka. Together, the two moves show a government juggling short term energy costs against the financing it needs to fix the system long term.

October 16, 2026Read more

Bangladesh Returns to the IMF Table, Seeking a Fresh $4.5 Billion Loan Through 2029

Five months after walking away from its $5.5 billion IMF programme eight months early, Bangladesh is back at the negotiating table in Bangkok, asking for a fresh loan of $4.5 to $5 billion. The new request comes as the country's revenue to GDP ratio has fallen to just 7 percent and bad loans in the banking sector have climbed to roughly a third of all lending. Finance Minister Amir Khosru Mahmud Chowdhury says talks are expected to conclude by the end of the year, with disbursements running in quarterly instalments through December 2029.

October 16, 2026Read more

Bangladesh Pledges Faster Project Approvals to Secure $10 Billion in Extra World Bank Loans

Bangladesh has asked the World Bank for up to $10 billion in additional financing over the next three years to cover energy subsidies, bank recapitalisation and essential imports. In exchange, Dhaka has pledged to cut project approval times from 18 months to eight and implementation from seven years to five. The request, made at the Bangkok annual meetings, runs alongside a separate negotiation with the IMF over a $4.5 billion loan.

October 14, 2026Read more

Bangladesh's Growth Outlook Darkens to 3.2% at IMF's Bangkok Meetings as Inflation Forecast Nearly Doubles to 10.9%

The International Monetary Fund has slashed its growth forecast for Bangladesh's current fiscal year to 3.2 percent and now expects inflation to average 10.9 percent, a level not seen since 2011. The downgrade, released at the IMF and World Bank's annual meetings in Bangkok, is steeper than forecasts from the World Bank and the Asian Development Bank. It lands just as Dhaka is negotiating fresh financing from both institutions to cover energy and fertiliser subsidies.

October 14, 2026Read more

Treasury Bill Yields Slip Below 8% for the First Time Since 2023 as Bank Liquidity Piles Up

All three Bangladesh Treasury bill tenors fell below 8% at auction on 11 October for the first time since October 2023, with the 91-day rate dropping 48 basis points in a single week to 7.65%. The decline is driven by a liquidity glut, with excess bank liquidity crossing Tk408,000 crore even as private sector credit growth has stayed below 5% for six straight months. Bankers say the falling yields reflect banks parking surplus cash in safer government securities rather than a healthy lending environment, and the trend could eventually pull fixed deposit rates lower too.

October 12, 2026Read more

Bangladesh Bank Holds Policy Rate at 9.5%, Then September's Inflation Proved the Caution Right

Bangladesh Bank left its benchmark policy rate unchanged at 9.5 percent on September 30, opting for caution in the first quarterly monetary policy statement it has issued under a new schedule tied to an IMF condition. Deputy Governor Md Habibur Rahman pointed to stubborn non food inflation of 9.32 percent and private credit growth of just 4.75 percent as reasons to hold steady so soon after an August rate cut. Days later, Bangladesh Bank's own data showed point to point inflation climbing back to 8.34 percent in September, breaking three months of cooling and arguably vindicating the central bank's reluctance to ease further. The World Bank's decision to cut its FY27 growth forecast to 3.4 percent within a week of the policy statement adds another reason the central bank may be glad it waited.

October 10, 2026Read more

Bangladeshis Poured 57% More Into Savings Certificates as the Government Leaned Harder on Bank Borrowing

Sales of national savings certificates jumped nearly 57 percent in July and August compared with a year earlier, National Savings Directorate figures show, as savers chased returns that still beat most bank deposits. The surge arrived just as the government itself leaned harder on commercial banks, with net borrowing from the banking system rising by about Tk13,000 crore in the same two months, a sharp reversal from last year's net repayments. Together the two trends sketch a government financing a revenue shortfall through whichever channel is available, from the post office counter to the commercial banking system.

October 9, 2026Read more

World Bank Warns Bangladesh Growth Will Stall at 3.4% for a Second Year Running

The World Bank now projects Bangladesh's economy will grow just 3.4 percent in fiscal year 2026-27, the same sluggish pace as the year before and far below the country's historical average of 5.6 percent. The bank points to a banking sector where bad loans have climbed to 33.2 percent of all lending and capital adequacy has turned negative, alongside an energy shortage that now forces Bangladesh to import roughly a third of its gas. The outlook is notably gloomier than the Asian Development Bank's own forecast of 4.5 percent growth for the same year, issued just three months earlier, underscoring how quickly confidence in Bangladesh's recovery has eroded.

October 7, 2026Read more

World Bank Signs $300 Million Deal to Keep Fertiliser Flowing to Bangladeshi Farmers This Planting Season

Bangladesh's Economic Relations Division and the World Bank signed a $300 million financing agreement on October 5 for the Emergency Support for Food Security Project, concessional credit at 1.5 percent interest over 25 years meant to keep fertiliser flowing to smallholder rice farmers through the current planting season. The amount and purpose match a fertiliser import component the World Bank's board had already approved back in June as part of a larger $1.1 billion emergency package, which means this week's signing most likely formalises financing agreed months ago rather than announcing fresh money. Bangladesh imports more than 85 percent of the fertiliser it uses, and the project is meant to cover roughly 1.4 million hectares of smallholder rice land during the seasons that produce about 90 percent of the country's rice.

October 6, 2026Read more

Bangladesh Scraps Its IMF Loan Programme Again, Betting on Bonds to Raise $50 Billion a Year

Finance Minister Amir Khosru Mahmud Chowdhury says Bangladesh has cancelled its IMF loan programme because the fund's conditions were unacceptable, the second time in under six months the government has walked away from an IMF arrangement. The government now wants to raise roughly $50 billion a year through domestic and international bonds, panda and samurai bonds, and equity funds, as it eyes a $1 trillion economy by 2034. The declaration comes just two days after BD Financial Review reported the government would borrow Tk30,107 crore from domestic banks this quarter to cover a persistent revenue shortfall, underscoring how closely the country's financing options are now linked.

October 5, 2026Read more

AkijBashir Joins RE100 as World Bank Team Discusses Energy Financing in Dhaka

AkijBashir Group has become the first Bangladeshi company to join RE100, the global corporate renewable electricity initiative, committing to power all its operations on renewable electricity by 2050. The announcement landed the same week a four member World Bank delegation arrived in Dhaka to discuss energy security financing and infrastructure reform, and a day after the government unveiled a new energy roadmap targeting 12,940 megawatts of fresh capacity by 2030. Together the three developments show a sector trying to finance its way out of a squeeze that cost the state fuel importer roughly Tk22,876 crore in just six months.

October 5, 2026Read more

Bangladesh Posted a Record $6.6 Billion External Surplus in FY26, but MCCI Says the Celebration Should Wait

Bangladesh's balance of payments swung to a $6.61 billion surplus in the fiscal year that ended in June, nearly double the $3.39 billion surplus logged a year earlier, as a record $35.59 billion in remittances and strong multilateral financing offset a sharply wider trade gap. The Metropolitan Chamber of Commerce and Industry says the external numbers mask a weaker domestic picture, pointing to persistent inflation, high borrowing costs and banking sector bottlenecks. The current account deficit widened to $1.59 billion from just $138 million the previous year, even as a $7.89 billion financial account surplus, driven mainly by foreign loans, did the heavy lifting of keeping the overall balance in the black. Fresh trade and remittance data from the new fiscal year's first quarter suggest the underlying engine may already be cooling even as the headline surplus looks strong.

October 4, 2026Read more

Government to Borrow Tk30,107 Crore From Banks This Quarter as Revenue Shortfall Persists

The government has set a Tk30,107 crore net borrowing target from treasury bills and bonds for October through December, a lower figure than the Tk35,000 crore borrowed last quarter but one economists say still reflects a deepening cash crunch. The shortfall traces back to revenue collection running roughly Tk29,000 crore behind target this fiscal year, compounded by a new government pay structure that will add Tk37,372 crore in costs this December alone. Centre for Policy Dialogue economist Fahmida Khatun warned that leaning on bank borrowing signals a liquidity shortage in government coffers rather than a sustainable financing strategy, while a Bangladesh Institute of Bank Management economist cautioned the approach will push up the budget's own interest bill. The plan lands the same week Bangladesh Bank held its policy rate at 9.5 percent and reserves eased back from June's peak, underscoring how tightly fiscal and monetary pressures are now linked.

October 3, 2026Read more

Bangladesh Bank Holds Policy Rate at 9.5% in First Quarterly Review, Even as Reserves Ease From June's Peak

Bangladesh Bank kept its policy rate unchanged at 9.5 percent on September 30, the first decision issued under its newly adopted quarterly review cycle rather than the half yearly schedule used for years. Inflation eased to 8.26 percent in August, the second straight monthly decline, yet the central bank warned that underlying price pressures and weak private credit growth still complicate the outlook. The hold came in the same week foreign exchange reserves eased to around $36 billion, down from a June peak near $37.6 billion, even as reserves remain far above where they stood two years earlier. Together the two data points describe a central bank trying to hold a steady course through a bumpy patch rather than declare victory over inflation.

October 1, 2026Read more

Bangladesh Bank Breaks With Twice a Year Habit, Moves to Quarterly Monetary Policy

Bangladesh Bank unveils its first ever quarterly monetary policy statement this afternoon, ending a half yearly cadence that dated back to 2024. The shift follows an IMF recommendation tied to the country's $4.70 billion loan programme and comes as inflation eases to an August low of 8.26 percent while the central bank's July forecast still points to price growth well above the government's 7.5 percent target. At stake is whether the 9.50 percent policy rate, cut in July for the first time in six years, holds steady or moves again.

September 30, 2026Read more

More Than a Third of Bangladesh's Educated Youth Cannot Find Work, IMF Data Shows

More than a third of Bangladesh's educated young jobseekers are unemployed, according to new IMF research published this month, far above the roughly 10 percent unemployment rate for all Bangladeshi youth. The finding builds on years of domestic labour force data showing the share of unemployed youth holding a degree has been climbing, not falling. Bdjobs.com founder Fahim Mashroor blames a lack of new industries capable of absorbing graduates, while Bangladesh still fares better than Sri Lanka and India, though worse than faster growing Southeast Asian economies. The IMF also warns that artificial intelligence could make the mismatch between graduates and available jobs even harder to close.

September 28, 2026Read more

Bangladesh Eyes First Ever Sovereign Dollar Bond by December, Emboldened by Moody's Outlook Upgrade

Bangladesh wants to price its first ever international sovereign bond, a dollar denominated deal worth 500 million to 1 billion dollars, by December, according to finance ministry officials who say investor response so far has been encouraging. The push follows Moody's September 16 decision to revise the country's credit outlook from negative to stable, even as the B2 rating itself stayed unchanged, a shift officials are counting on to make a first time debt sale more attractive to international buyers. The bond would fund a planned 19 percent increase in government spending and ease reliance on domestic bank borrowing, which has already overshot its own targets and pushed treasury yields higher. Sri Lanka's 2022 default and painful restructuring loom as a cautionary example of how badly reliance on this kind of borrowing can go.

September 27, 2026Read more

Bangladesh's Inflation Eases to 8.26 Percent for a Second Straight Month, but Relief Still Feels Far Off

Bangladesh's headline inflation eased to 8.26 percent in August from 8.32 percent in July, the second straight monthly decline, but the rate is barely different from the 8.29 percent recorded a year earlier. Food inflation fell to 7.02 percent while non-food inflation kept climbing to 9.32 percent, and economists including CPD's Fahmida Khatun caution that ordinary households have felt no relief in market prices. The reading arrived just weeks before Bangladesh Bank held its policy rate at 9.50 percent, citing inflation still above the government's target, and a fresh fuel price hike in September threatens to reverse even this modest improvement.

September 27, 2026Read more

ADB Cuts Bangladesh's Growth Forecast to 4 Percent, Warns Inflation Will Climb Back to 9 Percent

The Asian Development Bank has lowered its growth forecast for Bangladesh's next fiscal year to 4 percent, down from the 4.5 percent it projected just two months ago, citing supply chain disruption from the conflict in the Middle East and a summer of energy shortages. The bank now expects inflation to climb back to 9 percent in FY2027 after easing slightly this year, undoing some of the disinflation Bangladesh Bank has been working toward. A fresh Tk20 a litre fuel price increase this month is already showing up in the reasoning behind ADB's outlook. The lender is also flagging a widening current account gap even as it credits remittances for keeping the economy afloat.

September 25, 2026Read more

Bangladesh Bank Holds Policy Rate at 9.5 Percent as Inflation Stays Above Target

Bangladesh Bank's Monetary Policy Committee kept its benchmark policy rate unchanged at 9.50 percent on September 23, opting to wait rather than cut further just weeks after a fresh fuel price hike rippled through the economy. The hold leaves the rate exactly where it landed after July's cut, the central bank's first reduction in six years, even as inflation stays above the government's 7.50 percent ceiling for the fiscal year. The committee cited the Middle East conflict and the domestic fuel price increase as risks it wants to assess before making any further move. Private sector credit growth, meanwhile, remains stuck below 5 percent for a fifth straight month.

September 25, 2026Read more

Tk8,298 Crore Oil Pipeline Finally Gets an Operator After Sitting Idle for Two Years

Bangladesh has appointed Indonesia's Pertamina Trans Kontinental to operate the Tk8,298 crore Single Point Mooring oil pipeline off Maheshkhali, more than two years after construction was completed and a first operator tender collapsed over cost. The delay is estimated to have cost Tk1,000-1,200 crore in missed fuel logistics savings while Bangladesh Petroleum Corporation kept repaying project loans on an asset earning nothing. Even once Pertamina's five-year, roughly Tk1,950 crore contract begins operations around early 2027, the pipeline will run at only about a third of its designed capacity until a separate refinery expansion, not due until 2030, catches up. The case illustrates a recurring pattern in Bangladesh's infrastructure spending, where construction finishes well before the pieces needed to make a project pay for itself are in place.

September 25, 2026Read more

Bangladesh's Treasury Bond Yields Climb as Government Leans Harder on Bank Borrowing

Yields on Bangladesh's 15-year and 20-year treasury bonds rose again this week, climbing to 9.34 percent and 9.35 percent as the government announced Tk21,000 crore in additional bank borrowing for October and November. The increase follows a fiscal year in which government bank borrowing overshot its own revised target by more than Tk47,500 crore, driven largely by a revenue shortfall at the National Board of Revenue. Private sector credit growth remains stuck below 5 percent even as public borrowing keeps expanding, a squeeze economists say is now a binding constraint on private investment. The FY27 budget suggests the pressure is unlikely to ease soon.

September 23, 2026Read more

Moody's Lifts Bangladesh's Credit Outlook to Stable, But Bad Loans Still Loom Large

Moody's has revised Bangladesh's sovereign credit outlook to stable from negative, keeping the B2 rating unchanged but signaling that the acute political and external pressures of the past two years have eased. The upgrade rests on rebuilt foreign exchange reserves, record remittance inflows and a calmer post election transition, even as the rating agency flags persistent risks from a banking sector where nearly a third of all loans are sour. Dhaka's stock market rallied on the news, extending a rebound from a brutal five session slide earlier in the month. Economists say the real test now is whether the government can translate a friendlier outlook into the deeper reforms Moody's says are still missing.

September 17, 2026Read more