Bangladesh’s Purchasing Managers’ Index (PMI) recorded a notable surge in January, climbing 4 points from the previous month to reach 65.7 – marking a faster expansion rate reportedly.
This boost was driven by robust growth in the agriculture, construction, and services sectors, even as the manufacturing sector showed a slower pace of expansion. The report, jointly released by the Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka, and Policy Exchange Bangladesh (PEB) on Sunday, highlights an economy firmly on the expansion track for the fourth consecutive month. Key factors fueling this momentum include rising exports, seasonal consumption trends, and a strengthened agro supply chain.
Sectoral Highlights: Growth & Challenges
- Agriculture posted its fourth month of expansion at an accelerated rate, with business activity, new orders, and order backlogs all improving. However, employment in the sector contracted, and input cost expansion slowed.
- Manufacturing marked its fifth month of expansion but at a decelerating pace, with slower growth across new orders, exports, factory output, and input purchases. Employment in the sector, however, rebounded into expansion.
- Construction registered its second month of expansion, with notable acceleration in new business and activity levels. However, employment slipped into contraction, and order backlogs declined further.
- Services experienced its fourth month of expansion at a quicker pace, with gains in new business, employment, and order backlogs, while input costs returned to expansion.
Read more: Bangladesh’s RMG Exports Surge to $38.48 Billion in 2024
Despite overall economic momentum, investment confidence remains subdued in businesses catering to the domestic market. Factors such as weak demand, rising operational costs, and energy supply disruptions continue to pose challenges.
Going forward, the economy’s trajectory will largely depend on policy clarity and the roadmap for transitioning to an elected political government.
The PMI Initiative: A Game – Changer for Economic Insights
The Bangladesh PMI, an initiative led by MCCI and Policy Exchange, was developed with support from the UK Government and technical expertise from the Singapore Institute of Purchasing & Materials Management (SIPMM). It aims to provide timely, data-driven insights for businesses, investors, and policymakers to navigate economic shifts and make informed decisions.
With key sectors displaying mixed trends in future business confidence, how Bangladesh steers through domestic and global challenges will shape its economic outlook in the coming months.
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