December PMI: Economic Growth rises marginally by 0.2 points
Business Report :
The December reading of the Bangladesh Purchasing Managers’ Index (PMI) has increased by 0.2 points month-on-month to 54.2, signaling a slightly faster pace of economic expansion.
Data showed continued expansion in agriculture, manufacturing, and services, while the construction sector returned to marginal contraction, according to a press release issued on Wednesday by the Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka and Policy Exchange Bangladesh (PEB).
The PMI is a forward-looking indicator used globally to gauge economic direction. A reading above 50 indicates expansion, while a reading below 50 indicates contraction.
According to the statement, the agriculture sector grew for the fourth consecutive month, supported by higher new business, business activity, employment, and input costs, despite a faster contraction in order backlogs.
“The latest PMI readings indicate a marginal expansion of the economy, driven by strong agricultural sector performance,” said M Masrur Reaz, chairman and chief executive officer of PEB.
The agriculture sector recorded its fourth consecutive month of expansion, accelerating further in December. Stronger growth was observed in new business, business activity, employment and input costs, while order backlogs contracted at a faster pace, suggesting ongoing pressure on fulfillment capacity.
The manufacturing sector remained in expansion for the 16th straight month, though growth slowed slightly compared to November.
Expansion was recorded across most key indicators, including new orders, new export orders, factory output, input purchases, imports, input prices, employment and supplier deliveries.
Notably, the finished goods index returned to expansion, while order backlogs continued to contract, albeit at a slower rate.
In contrast, the construction sector reverted to marginal contraction in December. The new business index showed a faster rate of contraction, while construction activity and employment expanded at a slower pace. Input costs rose at a slightly faster rate.
Order backlogs continued to decline for the fifth consecutive month, though the pace of contraction eased.
The services sector posted its 15th consecutive month of expansion with growth accelerating slightly. Employment and input costs remained in expansionary territory, while new business, business activity and order backlogs recorded contraction readings, highlighting uneven demand conditions.
Many respondents expressed expectations of gradual improvement from early next year.
Looking ahead, the future business index showed slower expansion across agriculture, manufacturing, construction and services, suggesting cautious optimism.
The MCCI and PEB began publishing the PMI in January last year. Initiated by the UK government, it covers over 500 private sector firms across agriculture, manufacturing, construction, and services.
