IMF more upbeat than peers on Bangladesh economy

The International Monetary Fund (IMF) has projected that Bangladesh’s economy will grow by 4.7 per cent in the current fiscal year (FY26), before moderating to 4.3 per cent in FY27.

The FY26 growth estimate remains unchanged from the IMF’s January outlook published on Tuesday.

However, inflation is now expected to rise to 9.2 per cent in FY26, slightly higher than the earlier forecast of 8.9 per cent.

The Fund anticipates a notable easing in price pressures thereafter, with inflation projected to fall to 6 per cent in FY27.

In contrast, the Bangladesh government has set a provisional GDP growth target of 6.5 per cent for the next fiscal year, reflecting its longer-term ambition of achieving a trillion-dollar economy by 2034.

The government is also targeting an inflation rate of 7.5 per cent in FY27, which is above the IMF’s projection.

The IMF’s growth outlook is comparatively more optimistic than those of the World Bank and the Asian Development Bank (ADB), both of which released their forecasts earlier this month.

On 8 April, the World Bank projected Bangladesh’s economy to expand by 3.9 per cent in FY26, before recovering to 4.6 per cent in FY27.

It cautioned that the country faces mounting challenges, including slowing growth over three consecutive years, rising poverty, persistent inflation, a stressed banking sector, weak revenue mobilisation, and subdued private investment.

These pressures are further compounded by external headwinds, particularly the ongoing conflict in the Middle East.

Meanwhile, in its Asian Development Outlook (April 2026), the ADB forecast GDP growth of 4 per cent in FY26 and 4.7 per cent in FY27, up from an estimated 3.5 per cent in FY25.

Inflation is expected to remain elevated at around 9 per cent in FY26, reflecting high global energy prices and continued supply disruptions, before easing to 8.5 per cent in FY27 as external pressures subside and domestic supply conditions improve.

Both institutions warned that downside risks to the outlook remain significant, particularly if geopolitical tensions persist.

Disruptions to global energy markets, shipping routes and supply chains could sustain upward pressure on oil and gas prices, intensifying domestic inflationary pressures and complicating disinflation efforts, while limiting macroeconomic policy flexibility.