The Bangladeshi economy might have expanded in March, but at a slower pace due to sluggish growth in sectors like agriculture, manufacturing, and construction.
The Bangladesh Purchasing Managers’ Index (PMI) slipped by 2.9 points to 61.7 in March from the previous month, reflecting a slower pace of economic expansion.
For all latest news, follow The Daily Star’s Google News channel. The March reading marked a deceleration in expansion for key sectors such as agriculture, manufacturing, and construction, according to a report jointly released by the Metropolitan Chamber of Commerce and Industry (MCCI) and Policy Exchange Bangladesh (PEB).
Meanwhile, the services sector was the only one to post a faster rate of expansion.
The PMI is a leading economic indicator that signals the general direction of the economy. A reading above 50 indicates expansion, while a reading below 50 signals contraction.
The agriculture sector marked its sixth consecutive month of expansion, but at a reduced pace. Slower growth was observed in new business, business activity, and input costs.
Meanwhile, order backlogs slipped into contraction, and employment saw a faster rate of contraction.
Manufacturing registered its seventh straight month of expansion, although the pace moderated.
Most indexes remained in expansion territory, but order backlogs continued to contract, albeit at a slower rate.
Construction expanded for the fourth consecutive month, also at a slower pace. New business and input costs saw slower expansion, while employment picked up at a faster rate.
However, construction activity slipped into contraction, and order backlogs remained in contraction, though at a slower pace.
The services sector, now in its sixth month of expansion, recorded faster growth in business activity and employment.
However, new business and input costs expanded at a slower rate, while order backlogs contracted at a faster pace.
As for the Future Business Index, agriculture and construction posted faster expansion, while manufacturing slowed and services slipped into contraction.
“The latest PMI readings indicate a slower expansion of the economy in March,” said Masrur Reaz, Chairman and CEO of PEB.
“Only the service sector managed to post faster expansion, driven by Eid festivity, which is usually the peak business window for the retail sub-sector. The Future Business Index for the sector, however, posted its first contraction after 15 months of expansion.”
Launched in February 2024, the PMI was developed by MCCI and PEB, with support from the UK Government and technical assistance from the Singapore Institute of Purchasing & Materials Management.
The PMI surveys over 500 private sector enterprises and tracks trends across major economic sectors.