BD's June PMI falls by 5.8pts

Bangladesh's Purchasing Managers' Index (PMI) fell sharply by 5.8 points in June 2025, indication a 'notable' slowdown in its industrial and business activities, according to data released on Monday.

The index declined to 53.1 in June from 58.9 in May, reflecting the steepest monthly decline in over a year.

PMI is a key economic indicator derived from monthly surveys of private sector firms, offering insights into manufacturing and services sector trends.

A PMI above 50 indicates expansion while reading its below suggests contraction. On the other hand, a PMI 50 indicates that economy is neither expanding nor contracting. The scale is 0-100.

Despite remaining above the neutral 50-point mark, such a sharp drop indicates a weakening momentum in new orders, production, and supplier deliveries.

Over the past one year, the PMI had shown considerable volatility. It reached its peak with over 70 points in mid-2024 before plunging to below 40 by July that year, according to available data.

The index then rebounded steadily through early 2025 but it appeared to be losing steam again until the second half of the year.

Analysts attribute the recent dip to softer domestic demand, rising input costs and policy uncertainty ahead of fiscal adjustments.

"The economy is growing, but headwinds are clearly intensifying," said Dr. Masrur Reaz, Chairman and CEO of Policy Exchange of Bangladesh.

He said the reading has slowed in June by adding the construction sector for the first time in eight months contracted.

Unless the PMI rebounds in the coming months, it may signal a broader economic deceleration, prompting potential policy responses to revive investors and consumers' confidence.

jasimharoon@yahoo.com