Bangladesh’s private-sector business activity lost momentum in June as the Purchasing Managers’ Index (PMI) fell 9.9 points to 52.9 from 62.8 in May.
The decline in the monthly survey-based gauge of business activities reversed the previous month’s jump to a 15-month high as manufacturing and construction slipped back into contraction.
The June reading, released on Tuesday by the Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka and Policy Exchange Bangladesh, remained above the 50-point mark that signals expansion. Still, it matched April 2025’s 52.9, after May posted the strongest reading since February 2025.
Manufacturing led the slowdown in June. Its sector index fell to 48.8 from 64.1, returning to contraction after two months of expansion. New orders, export orders, employment, supplier deliveries and order backlogs all weakened. Factory output, imports and input purchases continued to grow, but at a slower pace. Input prices also accelerated.
Construction followed a similar path. Its index dropped to 40.2 from 52.9, ending a month of expansion. New business, construction activity and employment all contracted, while input costs and order backlogs continued to rise.
Agriculture remained the strongest-performing sector. Its index eased to 64.8 from 70.0, marking a tenth consecutive month of expansion. Services also stayed in growth territory for a 21st straight month, although its index slowed to 54.6 from 62.3.
Survey respondents said higher LPG and fuel prices, rising transport and operating costs, and increasing labour expenses continued to erode margins. They also cited financial constraints, disruptions from road construction projects and the recently imposed 15 per cent value-added tax, saying it had raised the cost of doing business.
Agricultural businesses pointed to weather uncertainty, while others reported subdued domestic demand.
“The June PMI suggests Bangladesh’s economy remained in expansion, but with clear sectoral divergence,” said M Masrur Reaz, chairman and CEO of Policy Exchange Bangladesh.
He said long Eid holidays, the onset of the monsoon and fading pre-Eid demand weighed on orders, exports, employment and business activity during the month.
Despite the June slowdown, businesses remained cautiously optimistic.
The survey’s Future Business Index pointed to continued expansion in agriculture, construction and services. Manufacturers also expect activity to return to growth in the coming months.
The Bangladesh PMI is jointly produced by MCCI and Policy Exchange Bangladesh with technical support from the Singapore Institute of Purchasing & Materials Management.
It is based on monthly surveys of more than 500 private-sector enterprises.
A reading above 50 indicates expansion from the previous month, while a reading below 50 signals contraction.
