Dhaka: The July reading of the Bangladesh Purchasing Managers’ Index (PMI) increased 8.4 points from the previous month, reaching 61.5, indicating a faster expansion rate. This marks significant progress for the country’s economy, particularly in the manufacturing and services sectors, despite challenges in agriculture and construction.
According to Bangladesh Sangbad Sangstha, the latest PMI reading highlights robust activity in the manufacturing and services sectors, with a notable turnaround in the construction sector, which shifted back to an expansionary phase. The agriculture sector, although still expanding, showed signs of slowing due to a reduction in the pace of new business, business activity, and input costs, while order backlogs increased at a faster rate.
The employment index across the sectors revealed some concerns, particularly with a contraction in employment for the second consecutive month. The manufacturing sector, experiencing its 11th month of expansion, showed growth in several areas including new orders, factory output, and input purchases, despite contractions in new exports and employment.
The construction sector’s return to expansion is a positive sign, with growth in new business, construction activity, and order backlogs, although it continues to face challenges with employment contraction for the third month. The services sector recorded its 10th consecutive month of expansion, with growth in new business and business activity, supported by increased employment and order backlogs.
Future business expectations in agriculture, manufacturing, and services have slowed, while the construction sector anticipates faster growth. Dr. M Masrur Reaz, Chairman and CEO of Policy Exchange Bangladesh, noted that the overall economic expansion in July was driven by the manufacturing and services sectors, with exports reaching an all-time high of $4.77 billion, despite the agricultural sector’s slower growth due to seasonal and weather-related factors.