Inflation returns to 9% range as fuel shock drives prices higher

Inflation in Bangladesh has climbed back into the 9 percent range within a month, as rising costs in both food and non-food sectors signal renewed price pressure across the economy.

Point-to-point inflation rose to 9.04 percent in April, according to data released on Wednesday by the Bangladesh Bureau of Statistics (BBS), reversing a brief dip seen in March when inflation had eased to 8.71 percent.

In February, the rate stood at 9.13 percent after several months of steady increases.

The latest figure means that a basket of goods and services costing Tk 100 in April last year now requires Tk 109.04, underlining the persistent strain on household spending.

The renewed uptick comes amid mounting concerns within the government that a fuel crisis, triggered by global volatility linked to the West Asia conflict, would push up the prices of essential commodities.

BBS data shows that inflation rose across both major components in April. 

Food inflation increased to 8.39 percent, up from 8.24 percent in March, reflecting continued pressure on essential items. 

Non-food inflation rose more sharply, climbing to 9.57 percent from 9.09 percent a month earlier.

The broader trend suggests inflation, which had briefly moderated, is regaining momentum. 

After peaking at 9.17 percent in April last year, inflation gradually declined to 8.17 percent by October -- the lowest level in 39 months. 

However, it has been rising steadily since then, reaching 8.29 percent in November, 8.49 percent in December, and 8.58 percent in January before crossing 9 percent again in February.

Although it dipped in March, the latest data confirms that the respite was short-lived.

Inflationary pressure is evident across both rural and urban areas. 

In rural regions, inflation rose to 9.05 percent in April from 8.72 percent in March. In urban areas, it increased to 9.02 percent from 8.68 percent over the same period.

While nominal wages have edged up slightly, they continue to lag behind inflation, leaving working-class households under sustained pressure. 

Wage growth rose marginally to 8.16 percent in April from 8.09 percent in March, offering little real relief.

Economists attribute the sharper rise in non-food inflation largely to higher fuel prices and increased costs of imported goods.

Zahid Hussain, former lead economist at the World Bank’s Dhaka office, said the impact extends beyond fuel alone. 

“It is not only fuel oil; the prices of all import-dependent goods have gone up,” he said, adding that inflation had already shown no clear signs of easing even before the latest crisis.

He noted that rising global prices are feeding directly into domestic inflation, while fuel cost increases are pushing up transportation expenses, amplifying price pressures across sectors.

“Fuel is part of the non-food category. Even without adjustments in electricity tariffs, higher fuel prices raise transport costs,” he said, adding that market prices had already begun rising before the government formally adjusted fuel rates.

On Apr 18, the government increased the prices of four types of fuel in response to rising global costs. 

Diesel rose by Tk 15 per litre to Tk 115, octane by Tk 20 to Tk 140, petrol by Tk 19 to Tk 135, and kerosene by Tk 18 to Tk 130.

At the time, the Ministry of Power, Energy and Mineral Resources said the adjustments reflected sustained increases in international market prices.