Point-to-point inflation expected to fall below 8% by June: Finance Adviser

Finance Adviser Dr. Salehuddin Ahmed on Monay said that point-to-point inflation is projected to decline below the 8% mark by June, as the government continues its efforts to stabilize the economy through a mix of contractionary policies.

Presenting the proposed FY2025–26 budget in a pre-recorded televised speech, Dr. Ahmed stated,

“The fight against inflation may slightly compromise GDP growth, but it is necessary for long-term economic stability.”

According to the adviser, point-to-point inflation has already dropped from 10.89% in December 2024 to 9.17% in April 2025.

“This year's Ramadan market for essential goods was among the most stable in recent memory,” he noted. “If the current trend persists, inflation will fall to around 8% by the end of June.”

He attributed the progress to the government's continued implementation of contractionary monetary and fiscal policies, which include-- raising the policy interest rate by 150 basis points to 10%; significantly reducing non-essential public expenditure; adopting a tight fiscal stance to complement monetary tightening.

Dr. Ahmed stressed the importance of exchange rate stability for sustained inflation control.

“A stable exchange rate of the taka against foreign currencies is vital. Achieving this will require maintaining adequate foreign currency reserves,” he said.

Regarding economic growth, the Finance Adviser said the provisional GDP growth for the current fiscal year (FY2024–25) is estimated at 3.97%. However, he added that the final figure is expected to be higher.

Looking ahead, the government anticipates a rebound, with the GDP growth rate projected to rise to 6.5% in the medium term.