Bangladesh’s economic growth momentum softened in August, with the country’s Purchasing Managers’ Index (PMI) dropping by 3.2 points to 58.3 compared to July, according to a report released on Sunday.
The PMI, jointly compiled by the Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka, and Policy Exchange Bangladesh (PEB), indicated that while the economy has now registered 11 consecutive months of growth, key sectors such as agriculture and construction slipped back into contraction.
The agriculture sector, which had experienced 10 straight months of expansion, was hit by declining new business, reduced activity levels, and rising input costs. Construction activity also contracted in August, following a brief rebound in July.
Employment levels fell for the third consecutive month, albeit at a slower rate, signalling persistent challenges in the labour market.
Meanwhile, the manufacturing sector continued its upward trend for the 12th month, supported by growth in new orders, exports, production, and imports. However, employment in the sector declined for the third month running, and order backlogs also weakened.
Despite some growth in new business, the construction sector faced declining backlogs and recorded a fourth straight month of job losses.
The services sector remained the most resilient, marking its 11th month of expansion. Business activity, new orders, and employment all showed moderate improvement, though backlogs of work contracted and overall growth in the sector eased.
Looking ahead, business sentiment weakened across agriculture, manufacturing, and construction, while service sector firms maintained a relatively more optimistic outlook.
“The overall economy has continued its expansion for 11 straight months, though the pace of growth has slowed,” said Dr M Masrur Reaz, Chairman and CEO of Policy Exchange Bangladesh. “Agriculture and construction were particularly affected by prolonged monsoon-related disruptions, while manufacturing and services reflected the slowdown in export earnings in August.”
Developed with support from the UK government and technical assistance from the Singapore Institute of Purchasing & Materials Management (SIPMM), the PMI is the first of its kind in Bangladesh. It aims to offer timely insights into the country’s economic performance, supporting businesses, investors, and policymakers with reliable monthly data.
