IMF revises Bangladesh GDP growth forecast to 5.4 percent

The International Monetary Fund (IMF) has reduced Bangladesh’s GDP growth projection for the 2025-26 fiscal year to 5.4 percent, down from its earlier April estimate of 6.5 percent.

On Monday, the IMF’s executive board in Washington approved the disbursement of $1.34 billion in two tranches under Bangladesh’s ongoing loan program, alongside an additional $800 million. Accompanying this decision, the IMF released economic projections, including the revised GDP forecast.

The IMF projects a 5.4 percent GDP growth for the 2025-26 fiscal year, while estimating a 3.8 percent growth for the current 2024-25 fiscal year, slightly below the Bangladesh Bureau of Statistics’ recent estimate of 3.97 percent. Additionally, the IMF forecasts an average inflation rate of 6.2 percent by the end of the next fiscal year.

The IMF noted that the swift establishment of an interim government following the August 2024 uprising has helped stabilize the political and security environment, fostering a gradual move toward economic stability. 

However, ongoing political uncertainties, tight monetary policies, increasing trade barriers, and pressures on the banking sector have dampened economic prospects.

Nigel Clark, IMF Deputy Managing Director and Acting Chair of the Executive Board, stated that Bangladesh faces significant economic challenges. He commended the authorities’ commitment to implementing necessary reforms and policy measures, particularly recent steps to adjust the exchange rate and boost budget revenues.

Despite the challenging political and economic landscape and heightened risks, Clark noted that progress under the IMF’s lending program has been largely satisfactory. He emphasized the importance of restoring economic stability, protecting vulnerable populations, and advancing reforms for inclusive and sustainable growth.