Global uncertainties may have an impact on growth: BB29 March 2023
Business Desk :
The Bangladesh Bank (BB) cautioned that persistent global uncertainty could hamper the country's GDP momentum and inflation.
The economic outlook is subject to significant uncertainties, which may arise from ongoing unfavourable global developments, such as the Russia-Ukraine war and tight global financial conditions, the central bank warned in its publication.
Every three months, the central bank issues a publication that details the country's economic indicators.
However, according to the report, the inflationary situation in Bangladesh is expected to improve again as the key trading partner economies' inflationary scenarios improve.
Though it rose to 8.78% in February, ending a five-month decline; it was up 21 basis points from the 8.57% reported in January, according to statistics from the Bangladesh Bureau of Statistics (BBS).
Prices in Bangladesh have been falling since August when they reached a 10-year high of 9.52% due to rising commodity costs in global markets. In December and November, the CPI increased by 8.71% and 8.85%, respectively.
Following recent macroeconomic developments, the government has reduced the GDP growth objective for FY23 from 7.50% to 6.50%.
The real GDP growth in FY22 was revised downward to 7.10% from 7.25%.
In the publication, BB stated that non-performing loans in the banking sector dropped in the second quarter of the current fiscal year, reflecting BB's relaxed policy approaches for loan repayment to tackle the ongoing macroeconomic issues.
According to central bank data, default loans in banks increased 17% year on year to Tk120,656 crore in 2022 due to a lack of corporate governance and the ongoing business recession.
NPLs, on the other hand, fell 10.2% in the fourth quarter of 2022, from Tk134,396 crore in the July-September period.