Inflation climbs to 8.58pc, highest in 8 months

Muhammad Ayub Ali :

The inflation rate of the country has risen for the third consecutive month, largely due to a sustained increase in food prices, putting additional pressure on household budgets across the country.

According to the latest data released by the Bangladesh Bureau of Statistics (BBS) on Sunday, the overall inflation rate reached 8.58 percent in January 2026, compared to 8.49 percent in December 2025 and 8.29 percent in November 2025.

In January 2025, the inflation rate was significantly higher at 9.94 percent. This year-on-year increase means that a product or service that cost Tk100 in January last year now costs approximately Tk108.58.

The food sector has been the main driver of inflation.

In January, food inflation rose to 8.29 percent, up from 7.71 percent in December, reflecting continuing price pressures on essential commodities.

Meanwhile, the non-food sector experienced a decline in inflation, dropping to 8.81 percent in January from 9.13 percent in December, indicating some easing of prices for non-food items.

Looking at rural areas, overall inflation increased slightly to 8.63 percent in January from 8.48 percent in December.

Food inflation in rural areas rose to 8.18 percent, while non-food inflation fell to 9.04 percent from 9.26 percent.

In urban areas, overall inflation edged up marginally from 8.55 percent in December to 8.57 percent in January.
Urban food inflation jumped to 8.61 percent from 7.87 percent, while non-food inflation decreased to 8.54 percent from 8.99 percent.

The rising inflation is particularly concerning given stagnant wage growth. While the overall inflation rate is 8.58 percent, the wage growth rate in November stood at 8.08 percent, indicating that incomes are not keeping pace with the rising cost of living.

This gap means that workers’ purchasing power is being gradually eroded, making it more difficult for households to cope with everyday expenses.

There are two main factors behind the price increases observed in January. First, certain price adjustments appear to have been influenced by election-related dynamics.

Second, there were notable changes in the supply of gas during the month said Dr Zahid Hussain is the former lead economist at the World Bank Dhaka Office.

If the supply of gas and other essential commodities were free from undue restrictions, monopolistic practices, or extortion, it would be much easier to stabilize the market and prevent artificial price hikes, he explained.

At the same time, it is crucial that healthy competition in the market be maintained, allowing multiple players to operate freely while safeguarding consumer interests.

He also said that ensuring transparent supply chains, fair competition, and preventing market manipulation are key to controlling prices and protecting citizens’ purchasing power; without them, inflation may keep rising