Target pared down to 8.0pc this June, 6.50pc by next

City-dwellers still feel the bite of high food prices although overall inflation eases by latest official count and the interim government pares the rate down progressively from July in the forthcoming fiscal year.

The carried-over high inflation is still close to a double-digit level while the post-uprising government now fixes budgetary targets to tame it down to 8.0 per cent this June and 6.50 per cent by the end of the fiscal year (FY) 2025-26.

The point-to-point inflation rate in May decreased to 9.05 per cent from 9.17 per cent in the previous month of April on a downturn straight for the fifth month since January this year, according to Bangladesh Bureau of Statistics (BBS) data unveiled Monday.

Meanwhile, the government for the next fiscal year sets a target to bring down the inflation to 6.50 per cent from the current average rate of 10.13 per cent recorded in the latest BBS report.

In his budget speech Monday, Finance Adviser Dr Salehuddin Ahmed admitted that inflation remained a concern and so measures were taken to contain price rises.

He mentions contractionary monetary policy and raised policy rate aimed at controlling money supply on the market.

"If the falling trend in the month-on-month inflation continues, point to-point inflation would come down to 8.0 per cent in June and further fall to our expected level (6.50 per cent) at the end of next fiscal year," he said in his recorded budget speech.

Yet, the food inflation in the urban areas rose by 0.16-percentage points to 9.29 per cent last month from 9.13 per cent in the previous month, April, the BBS data showed.

The rate of inflation in May last year was recorded at 9.89 per cent.

Maintaining higher trends for more than two years, the inflation rate on point-to-point basis climbed to a 13-month high at 11.38 per cent in November this fiscal year (FY 2024-25) before a climb-down in the subsequent months.

The rate of inflation in December fell to 10.89 per cent, then to 9.94 per cent in January, 9.32 per cent in February, 9.35 per cent in March, 9.17 per cent in April and 9.05 per cent in May, the official data showed.

The higher inflationary pressure started biting the middle-and lower-middle class and poor people from two and a half years ago as their expenditure for buying necessary items was eating up the lion's share of their wages and monthly incomes.

Since January last, the inflationary pressure has eased with the rate now falling into the single-digit bracket from a 10.89-percent rate last December.

Following the Russia-Ukraine war and some other internal factors, the inflation suddenly jumped into 9.0-percent club 22 months ago in August 2022 from the long-maintained 6-7-percent one in the previous period.

Officials of BBS say since inflation for both at food and non-food items has declined, the overall monthly inflation also fell last month (May).

According to BBS data, the rate of food inflation last month was 8.59 per cent.

In the previous month, April, the food inflation was 8.63 per cent. On the other hand, the rate of non-food inflation fell to 9.38 per cent last month. The rate was recorded at 9.61 per cent in the previous month of April.

Meanwhile, the point-to-point inflation in urban areas is recorded at 9.50 per cent for May, 0.09-percentage-point lower than 9.59 per cent in the previous month, the BBS statistics showed.

The food inflation rate in the urban Bangladesh has surged to 9.29 per cent in May from that of 9.13 per cent in April. The non-food inflation decreased to 9.63 per cent last month from 9.88 per cent in April in the towns.

In the rural areas, the rate of inflation last month was recorded at 9.05 per cent in a fall from 9.15 per cent in the previous month.

The food-inflation rate in villages was down to 8.30 per cent in May from 8.40 per cent in the previous month.

The rate of non-food inflation in rural areas also fell, to 9.75 per cent in May from 9.86 per cent in the previous month, the official data showed.

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