The Policy Research Institute of Bangladesh (PRI) in its Monthly Macroeconomic Insights (MMI) for November 2025 edition has observed that Bangladesh has achieved a measure of macroeconomic stabilization.
The report has shown modest stabilisation, with improved exchange rate stability, higher foreign reserves, and easing inflation.
The observations were made today at the launch of the latest issue of MMI, organised by the Centre for Macroeconomic Analysis (CMEA) of the PRI, in partnership with the Department of Foreign Affairs and Trade (DFAT) of the Australian Government, at PRI’s conference room in the city, said a press release.
According to the report, the external sector improved on the back of record remittance inflows, despite stagnant exports and weak global demand.
Inflation remains elevated above 8%, driven mainly by persistent food and rice price pressures.
Severe banking sector stress, revenue shortfalls, and historically low ADP implementation underscore the need for political stability and structural reforms.
Kamran T. Rahman, President of the Metropolitan Chamber of Commerce and Industry (MCCI), graced the event as chief guest and emphasized the importance of policy certainty, stating, “Restoring growth will depend on policy predictability, as businesses are discouraged by uncertain and volatile environments such as the current one.
Containing inflation will require supply-side reforms and smarter trade policies alongside a tight monetary stance. Without meaningful tax reform, fiscal space will remain constrained.”
The session was chaired by Dr. Zaidi Sattar, Chairman of PRI. In his remarks, he said, “Nominal exchange rate has been stable at around 122 taka per dollar, but our real effective exchange rate, which actually determines Bangladesh’s competitiveness relative to other competing countries, has shown a sharp appreciation of 6 to 7% REER over the last 4 months.”
He said that Bangladesh Bank is committed to a flexible exchange rate regime and flexible exchange rate is a regime that restores balance of payment stability and restores stability in the foreign exchange reserves.
“It does not necessarily guarantee accumulation of reserves, particularly in a short period of time. Bangladesh Bank’s effort is to increase reserves led to its purchase of 3.3 billion US dollar in FY26. This works as a force to stem the appreciation,” he added.
“But there are positive and negative implications. For a flexible exchange rate, in the short term, you can have appreciation and depreciation. Depreciation will increase exports and reduce imports. So an appreciation would have been good for increasing imports, which have been sluggish,” he added.
He said another thing is appreciation would have been good for inflation control. “So there are trade-offs. So I don’t know which trade-off actually works, buying the dollars, but my point is that we are intervening in the foreign exchange market, which is against Bangladesh Bank’s commitment to a flexible exchange rate policy,” he added.
Bangladesh is a developing economy. It does not shrink. What happens is growth slows down. So Bangladesh economy grows. It has internal momentum for positive growth. 54, years, we have seen growth average 3-3.5% in the 1980s. But since then, 1990 1920 to 2010, every decade average growth has gone up by at least 1%. So inherent growth momentum is something like 6%.
Even without any reform, this economy can grow at 6%. Right now we have muted growth of under 4%because that is also related to investment slowdown. Bangladesh’s Our growth is investment-driven, not Policy Research Institute of Bangladesh consumption-driven.
So investment slowdown is there. Where investment-GDP, needed is 30% to generate 6% growth, our latest estimates of investment GDP ratio is around 28-29%. So there is an investment slowdown, which is also leading to that growth slowdown.
Macroeconomic stability is the strong point. It’s important to note that macroeconomic stability is the foundation for higher growth. So when there is macroeconomic instability, you don’t expect growth to be high also.
The keynote presentation was delivered by Dr. Ashikur Rahman, Principal Economist at PRI.
He underscored, “As we look ahead to 2026, it is increasingly clear that perpetual instability — both external and domestic — is no longer an exception; it has become a new normal. Global geopolitical shocks, wars, trade disruptions, climate volatility, and shifting international economic dynamics will continue to test resilience.
At the same time, internal political uncertainty, institutional stress, and governance challenges will continue shaping macroeconomic management. Economic policymaking in 2026 cannot assume stability returning soon. Instead, it must embrace uncertainty as a defining condition and build strategies around it. Policy frameworks must be flexible. Institutions must be capable of mobilising real-time responses. Decisions must be timely, credible, and anchored in preparedness.”
In many ways, he mentioned, “We must behave like a deer in a forest — always alert, always conscious of the environment, attuned to early warning signals and crisis time economic playbook. Because what appears stable today can become chaotic tomorrow. Survival and progress in this new world will depend on vigilance, adaptability, discipline, and readiness to act decisively.”
During the panel discussion, Dr. Nasiruddin Ahmed, Former Chairman of the National Board of Revenue (NBR), warned that rising corruption and mob violence are undermining economic sustainability, stressing that without stable law and order, growth will remain fragile.
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