IMF reduces growth forecast for Bangladesh

Projects that the country’s GDP (real) will grow at 6.4% in

The International Monetary Fund (IMF) has cut Bangladesh’s growth forecast for fiscal year 2021-22 (FY22) in view of the fallout from Russia’s invasion of Ukraine.

The IMF projects that the country’s GDP (real) will grow at 6.4% in FY22 — 0.2 percentage points lower than projected in October 2021.

The funding body has made the growth forecast in its “World Economic Report” released on Tuesday.

It also projected the GDP growth for FY 2023 at 6.7%.

It also estimated the rate of inflation at 6.4% in FY22 for Bangladesh.

On Tuesday, Bangladesh’s statistical agency showed its March 2022 inflation rate at 6.22% on a point-to-point basis.

The IMF also said that higher oil prices would weigh on private consumption and investment.

It also expects Bangladesh’s current account deficit to be at 3.2%.

The report said the war in Ukraine triggered a costly humanitarian crisis that demands a peaceful resolution.

Economic damage from the conflict will contribute to a significant slowdown in global growth in 2022.

A severe double-digit drop in GDP for Ukraine and a large contraction in Russia are more than likely, along with worldwide spillovers through commodity markets, trade, and financial channels.

The report also said inflation is expected to remain elevated for longer than in the previous forecast, driven by war-induced commodity price increases and broadening price pressures.

For FY22, inflation is projected at 5.7% in advanced economies and 8.7% in emerging market and developing economies – 1.8 and 2.8 percentage points higher than projected in January.