Economic momentum slows down in April

The country’s economic momentum has slowed down in April. The Purchasing Managers’ Index (PMI) value for the country’s four major economic sectors dropped by 8.8 points in April. The index fell to 52.9 points, the lowest since October last. In March, the index stood at 61.9.

The century-old business and entrepreneurs' organisation Metropolitan Chamber of Commerce and Industry (MCCI) and research institute Policy Exchange of Bangladesh have been jointly formulating this PMI index for the last one year. The index was published on Thursday (May 8).

If the PMI index is above 50, it indicates economic expansion, and if it is below 50, it indicates contraction. A value of 50 means there was no change in the respective sector for that month. In July last year, due to the quota reform and anti-government movement, the PMI dropped to 36.9 points. In August, it slightly increased to 49.7 points. By October, it rose to 55.7 points. Since then, the economy has been on an expansionary trend.

According to the report by MCCI and Policy Exchange, all four major sectors of the country's economy expanded last month, although the pace of expansion has slowed. The agriculture sector has expanded for the seventh consecutive month, the manufacturing sector for eight months in a row, the construction sector for five consecutive months, and the service sector for seven months. Regarding the future of the four major sectors, the report indicates that while the manufacturing and construction indices are likely to see strong growth, the expansion of the agriculture sector will be slower.

Commenting on the report, Chairman and CEO of Policy Exchange Bangladesh M Masrur Reaz said, “Recent PMI data indicates that the expansion of the major sectors of the economy continues, although the pace has slightly slowed. April's PMI is the lowest since the expansion began in October. The slowdown is likely due to extended holidays leading to business closures, the initial impact of tariffs imposed by Trump on the garment sector, and issues in fuel supply.”