Despite a recent marginal dip in the national inflation rate, persistently high prices continue to inflict significant hardship on lower and middle-income households across Bangladesh, severely eroding their purchasing power and forcing many to seek alternative income sources.
The prolonged period of soaring costs has made every essential purchase a test of resilience for families whose incomes often struggle to keep pace with the rising cost of living.
Kawser Mia, a private sector employee in Tejgaon, exemplifies the escalating financial strain. In 2016, he borrowed Tk10 lakh from a bank at an 8 percent interest rate to repair his village home in Mirzapur, Tangail. Today, his loan installment has surged to a daunting 15 percent interest, nearly double the original rate.
“The loan installment has increased severely, now consuming around 65 percent of my salary,” Kawser lamented. “It was flexible when I first borrowed, but now it has become very burdensome.”
To cope with the drastically increased payment and other family expenditures, Kawser has been forced to work as a street vendor after his regular job.
Govt identifies persistent inflation as top challenge in medium-term outlook
He, like many others, finds himself in distress due to the impact of inflation adjustments in the banking system, which have led to higher interest rates for consumers. This situation has driven many middle and low-income individuals to seek additional employment, with some turning to street vending in Dhaka and other cities.
SM Nazer Hossain, vice president of the Consumers Association of Bangladesh (CAB), said that inflation has adversely affected the living standards of both service holders and farmers in urban and rural areas. Despite CAB’s efforts to advocate for lower consumer goods prices, food costs remain elevated, often attributed to hefty production expenses.
Hossain highlighted the unexpected rise in rice prices immediately after the Boro season, noting that many large companies are now engaged in rice trading, selling packaged rice for over Tk100 per kg.
The Bangladesh Bureau of Statistics (BBS) reported a national point-to-point inflation rate of 9.05 percent for May, with food inflation at 8.59 percent and non-food inflation at 9.42 percent.
While these figures indicate a marginal improvement from previous months, the 12-month moving average inflation rate, which stood at a high 10.13 percent from June 2024 to May 2025, paints a clearer picture of the sustained pressure on household budgets over the past year.