Remittance booms to new high, helping ease inflation down to 8.48pc

Bangladesh’s economy received a dual boost this month as inflation continued its downward trajectory and remittance inflows surged to historic levels, signaling potential relief for household budgets and broader economic stability.

According to the latest data released on Monday by the Bangladesh Bureau of Statistics, the country’s general point-to-point inflation eased to 8.48 percent in June, down from 9.05 percent in May.

The decline was largely driven by a notable drop in food prices, with food inflation falling to 7.39 percent in June — its lowest point in two years — compared to 8.59 percent the previous month. Non-food inflation also edged down, registering 9.37 percent in June from 9.42 percent in May. The moderation was seen across both urban and rural areas, offering some relief to consumers who have faced persistent cost-of-living pressures.

At the same time, Bangladesh is benefiting from a strong flow of funds sent home by its overseas workers. Data from Bangladesh Bank released on Monday showed that remittances climbed by an impressive 15.34 percent year-on-year in the first six days of July, totaling $427 million. During the same period last year, the figure stood at $371 million.

The new fiscal year’s start builds on an extraordinary performance in FY2024-25, when remittances hit a record $30.33 billion — the highest ever received by the country in a single fiscal year. This marked a sharp 26.80 percent increase from the $23.91 billion remitted in FY2023-24, underscoring the critical role of expatriate Bangladeshis in supporting the economy.

Together, easing inflation and robust remittance growth could help bolster domestic consumption and stabilize the country’s external balances. Economists note that sustained remittance inflows are particularly vital for offsetting trade deficits and maintaining healthy foreign exchange reserves, while the cooling of prices provides much-needed breathing space for ordinary Bangladeshis after months of high inflation.