The global airline industry nearly halved its ​2026 profit forecast on Sunday, citing conflict in the Middle East that has driven up fuel costs, disrupted key air ‌corridors and exposed the fragility of a sector operating on thin margins.

The International Air Transport Association, which represents more than 370 airlines accounting for about 85 percent of global air traffic, said in its annual report that it now expects the industry to post a combined net profit of $23 billion in 2026, well below a previous projection of ​about $41 billion and down from $45 billion in 2025.

The downgrade underscores airlines’ exposure to geopolitical shocks and fuel volatility, even as passenger ​demand remains resilient, planes are flying fuller and revenues are set to rise to more than $1.1 trillion.

“There are two major factors: one is the significant increase in jet fuel prices, which has gone way higher than I think anybody would have expected, and ​then the disruption to the airlines in the Gulf region, so that combination has led us to reduce the forecast,” IATA Director General Willie Walsh ​told Reuters at the group’s annual meeting in Rio de Janeiro.

Walsh said he expects some smaller airlines to go bankrupt or be taken over by bigger carriers this year and next as higher fuel costs bite. US low-cost carrier Spirit Airlines shut down last month, the first airline casualty of the Iran war.

Airlines are also expected to cut ​unprofitable routes to protect margins, while fares - which have surged since the start of the Iran war - are unlikely to fall soon, Walsh said.

“In ​an environment where demand remains pretty robust, but capacity comes down, that will likely lead to a situation where fares will remain elevated,” Walsh said.

The Middle East conflict, triggered by US and Israeli airstrikes on Iran, has forced airlines to reroute flights around closed or restricted airspace, adding hours to some journeys, increasing fuel burn and straining already tight capacity.

At the same time, oil prices have surged on fears of supply disruption, pushing jet fuel prices sharply higher and widening refinery margins, leaving airlines facing a steep jump in their largest cost.

Gulf airlines such as Emirates, Qatar Airways ​and Etihad Airways face the greatest ​operational uncertainty after a near-complete shutdown of regional airspace at the start of the conflict.

Walsh said most regions should remain profitable, though at lower levels, while Middle East airlines are likely to slip into the red due to the conflict and weaker ​demand.

IATA expects airlines’ fuel bill to surge to about $350 billion this year from roughly $252 billion in 2025, with ​fuel accounting for ⁠nearly a third of operating costs.

That is eroding profitability per passenger, with airlines now expected to earn about $4.50 per passenger, roughly half last year’s level.

On the upside, IATA expects industry revenues to rise 9.4 percent to around $1.16 trillion this year, driven by steady travel demand, higher fares, and growing income from extras such ⁠as seat ​upgrades and onboard services.

Aircraft shortages are also squeezing the sector. Delivery delays at Boeing and ​Airbus are forcing airlines to keep older, less fuel-efficient planes in service for longer, raising maintenance bills and blunting efforts to improve margins, Walsh said.

Masud Khan, the newly appointed chairman of the Bangladesh Securities and Exchange Commission, has announced an aggressive strategy to bring high-quality companies to the stock market through direct listing, describing the move as essential for building stronger institutions and ensuring the long-term sustainability of the private sector.

Speaking as the chief guest at the 10th Anniversary Gala Night of the CFA Society Bangladesh yesterday (6 June), Masud said the regulator would actively encourage state-owned enterprises, multinational companies and fundamentally strong local corporates to join the capital market.

"Once you create a listed company, you bring in more professionals, and ultimately, you solve the issues of succession and sustainability," he said.

"Private sector companies often collapse when ownership changes, but listing turns a company into a lasting institution. I personally think we are going to be very aggressive in a direct listing. We will identify good companies and tell them: go for it."

The BSEC chairman pointed out that many well-governed entities, such as banks and MNCs, already maintain transparent accounts and do not necessarily need to raise fresh capital through an Initial Public Offering (IPO). For such firms, he suggested that direct listing is the most logical route to enter the capital market.

"For banks, MNCs, and good local corporates that are already capital-sufficient, I will say: I don't want your capital; just go for direct listing to allow public participation and enhance your institutional status," he added.

Simplification over complication

Masud, who brings decades of experience from the corporate sector, laid out a regulatory philosophy based on the mantra: "Regulate where necessary and simplify where possible." He expressed a firm commitment to overhauling the existing rulebooks for IPOs, margin loans, and mutual funds, which he believes have become unnecessarily cumbersome.

"The rules have to be simplified significantly. If we want the market to deepen, we cannot work in isolation; market intermediaries must be part of this process," he said.

The BSEC chairman lamented the lack of meaningful dialogue between the regulator and market participants in recent years, noting that many constructive suggestions from reform committees previously failed to "see the light of day" because regulators believed they knew better than the market.

While advocating for simplification, he issued a stern warning against malpractice. Referring to a finance minister's stance, he said, "Please self-govern, but if you are caught violating the rules, your 'chips will fry.' Be very sure that whatever you are doing is absolutely right, because once caught, there is no easy entry back."

Science of valuation and 'horror' of paper

A key priority for the new BSEC leadership is the digitisation of the entire capital market ecosystem. Masud described the current state of reporting as a "horror story," pointing out that merchant banks and mutual funds are still required to submit applications for IPOs and rights issues on physical paper. "How are we still living in the Stone Age? This has to stop immediately," he asserted.

Addressing market volatility, he characterised the share market as a "science" involving the intricate study of valuation - a skill he noted is severely lacking among the general investing public. "We are in a situation with many uninformed investors. As a result, most trading today takes place in junk shares - small-cap companies or firms that have been closed for years. This is not efficient."

To combat manipulation in these "previous" or junk shares, the chairman announced plans for a robust, integrated surveillance system. This system will align the BSEC, the Dhaka Stock Exchange, Chittagong Stock Exchange and the Central Depository Bangladesh Limited with automated triggers to halt or release trading instantly based on suspicious activity.

CFA Society's milestone

The event also served as a platform for the CFA Society Bangladesh to celebrate a decade of promoting professional excellence. The Society recognised the top employers of CFA Charterholders in the country, including Bangladesh Bank, BRAC Bank, City Bank, IDLC Finance, EDGE AMC, IDLC Finance, Prime Bank Securities, Shanta Asset Management, Shanta Securities, Standard Chartered Bank, HSBC Bangladesh, United Commercial Bank. It also honoured top universities such as the University of Dhaka, BUP, BRAC University, and North South University for their high registration rates in the CFA Program.

M Masrur Reaz, chairman of Policy Exchange Bangladesh, delivered the keynote address, focusing on the need for a conducive fiscal policy to improve the investment climate.

Asif Khan, president of the CFA Society Bangladesh, highlighted the society's growth, noting that it now boasts over 131 Charterholders and 80 Associate Members working across the nation's most reputed financial institutions.

The government is set to announce corporate tax rates for the next five years, offering the long-term policy certainty businesses and investors have long sought for.

Tax rates, however, are unlikely to increase. Finance ministry officials familiar with the matter say the government plans to keep rates unchanged until fiscal year 2030-31.

Finance Minister Amir Khosru Mahmud Chowdhury is expected to go further in his first national budget, due on June 11, by introducing a broader three-year predictable tax framework, extending beyond the two years already announced by the interim government.

Prime Minister Tarique Rahman approved the proposal in principle on May 14 during a high-level meeting at the Secretariat, according to finance ministry officials who attended.

Under the proposed roadmap, listed companies would pay a corporate tax rate of 22.5 percent, while non-listed firms would be taxed at 27.5 percent. Both categories could qualify for reduced rates of 20 percent and 25 percent, respectively, if all income is channelled through banking transactions.

One Person Companies (OPCs) are likely to face a tax rate of 27.5 percent. Banks, insurance companies and other financial institutions would pay 37.5 percent if listed and 40 percent if non-listed.

Mobile operators are likely to be taxed at a flat 45 percent, while private universities and colleges could benefit from a reduced rate of 10 percent. Tobacco products and cigarettes would remain subject to a 45 percent tax plus a 2.5 percent surcharge.

“There will be an indication in the budget to reduce corporate tax gradually as the government looks to expand its coverage,” a senior finance ministry official said, requesting anonymity.

The official added that companies currently paying the highest rates are likely to see gradual reductions in the coming years.

In fiscal year 2021-22, the corporate tax rate for non-listed companies was reduced to 30 percent from 32.5 percent, while the rate for listed firms was cut to 22.5 percent from 25 percent.

Rupali Chowdhury, president of the Foreign Investors’ Chamber of Commerce and Industry (FICCI), welcomed the move, saying policy predictability is essential for business planning and investment decisions.

“We like predictability very much. Predictability is good. Businesses need certainty to make long-term investment decisions,” said Chowdhury.

She argued that recent increases in supplementary duties have offset the benefits of lower corporate tax rates.

“Corporate tax is imposed on profits, but supplementary duty is imposed on revenue. On one hand, the tax rate is being reduced, but on the other hand, the government is taking back more through higher supplementary duties,” she said.

Chowdhury said businesses often have little choice but to pass the additional costs on to consumers, contributing to inflation and raising operating costs.

She also expressed concern that compliant companies bear a disproportionate share of the tax burden while non-compliant firms continue to evade taxes, undermining fair competition and reducing government revenue.

Snehasish Barua, managing director of SMAC Advisory Services, said the roadmap would provide much-needed certainty but warned against locking in tax rates for an extended period.

“Globally, corporate tax rates are falling. Locking Bangladesh’s private company tax rate at 27.5 percent until assessment year 2030-31 risks severely damaging our competitiveness against regional peers such as Vietnam and Indonesia,” he said.

He noted that international practice usually limits such policy commitments to two or three years.

Barua said maintaining relatively high corporate tax rates over the long term could discourage private investment at a time when Bangladesh needs stronger economic growth and job creation.

“If the government’s ultimate goal is to create employment, it must rethink locking in uncompetitive long-term rates and instead design an agile fiscal strategy that stimulates domestic investment and robust job growth,” he added.

Masrur Reaz, chairman of Policy Exchange Bangladesh, also welcomed the proposal, saying it addresses longstanding concerns about policy inconsistency. However, he said Bangladesh’s corporate tax rates and overall tax burden are high compared with regional competitors such as Vietnam, Indonesia, Thailand and India.

“This is the first positive step, but the next important step should be rationalising the corporate tax rate, which is still quite high compared to comparable economies,” he said.

He added that advance income tax and other mechanisms increase the effective tax burden beyond the headline rate. “While predictability is welcome, the next step must be rationalisation of tax rates to improve competitiveness,” he said.

Bangladesh’s overall inflation climbed to a 16-month high of 9.42 percent in May, driven largely by a sharp rise in food prices that is squeezing household budgets, particularly for low- and middle-income families.

According to data released by the Bangladesh Bureau of Statistics (BBS), food inflation rose to 9.06 percent in May from 8.39 percent in April, reflecting higher prices of essential commodities. Non-food inflation also increased, reaching 9.71 percent from 9.57 percent in April.

Rural areas bore the brunt of the rise, with inflation climbing to 9.48 percent from 9.05 percent the previous month. Urban inflation rose from 9.02 percent to 9.25 percent.

A BBS official, speaking on condition of anonymity, said the increase was spread across a range of commodities rather than concentrated in any single category of items.

“It increased in some places and decreased in others. For example, summer vegetable prices have been easing, but year-round and winter vegetables such as tomatoes and carrots are rising again. Egg prices have also gone up,” the official noted.

They added that the full effect of the recent fuel price adjustment had not yet been captured in the May figures, and that a further spike in inflation next month was likely as a result.

Analysts and policy researchers agree that the current trajectory is cause for concern, and that the risks ahead may be greater than the May figures alone suggest.

Ashikur Rahman, principal economist at the Policy Research Institute (PRI) of Bangladesh, said the government was compelled to adjust fuel and electricity prices to tackle the impacts of the US-Israel war on Iran.

It is natural that the impact will eventually spread across the entire supply chain and be reflected in higher prices, he noted.

“What is more concerning is that inflation may rise further in the coming days,” he said, arguing that the financial situation, combined with planned subsidy expansion in the budget, pointed in that direction.

Rahman said judging from the design of the budget, it could no longer be said that the country is pursuing a contractionary monetary policy, since such a policy required a tight fiscal stance alongside a high policy rate.

Instead, he said, the government was moving toward expansionary fiscal policy and a looser monetary environment simultaneously — a combination that carried significant inflation risk.

“If immediate attention is not given to this issue, inflation could rise sharply within a short period,” he cautioned, noting that similar situations have been observed in Pakistan and Sri Lanka.

“When an economy experiences a supply shock, some argue that there is no need for a contractionary monetary policy environment. This view is wrong,” he said. “To bring inflation under control, a tight monetary environment is necessary, accompanied by a correspondingly tight fiscal stance. Unfortunately, we are moving in the opposite direction on both fronts.”

The Centre for Policy Dialogue (CPD) has reached a similar conclusion about the underlying drivers.

In a recent report, the think-tank found that external shocks, including the Covid-19 outbreak, the Russia–Ukraine war, and the Middle East conflict, have exerted significant upward pressure on essential commodity prices in Bangladesh, exposing the economy’s growing vulnerability to international disruptions and their spillover effects on domestic inflation.

Both Rahman and CPD point to structural weaknesses in domestic markets as compounding the problem.

The CPD called for stronger monitoring and regulatory oversight of intermediaries, particularly those who trade in bulks, to curb collusive practices and artificial price manipulation in essential commodity markets.

It also recommended reducing excessive layers of intermediaries in supply chains to narrow the gap between farm-gate and retail prices.

The think-tank also urged the government to maintain strategic reserves of essential food items and release them during supply shocks to stabilise prices. It also recommended strengthening social protection schemes for low-income households in light of recent hikes in cooking gas and transportation costs.

PRI’s Ashikur, meanwhile, noted that with inflation approaching 10 percent, attempting to stimulate growth through expansionary policies was highly risky.

He recommended attracting investment through productivity-enhancing reforms instead, including privatisation of state-owned enterprises, easing of investment and business regulations, and prioritised spending in the energy and logistics sectors.

Two decades of state investment have transformed Turkey into a major exporter of drones and other military equipment, and the NATO member is now looking to build on that momentum as the West rearms and security alliances are reshaped.

Turkey, once heavily reliant on foreign arms makers, now supplies nearly 40 countries mainly in the Gulf, Africa, Asia and parts of Europe with weapons that many buyers see as cheaper, faster to deliver and more adaptable than alternatives.

As European governments reassess security dependencies following Russia's invasion of Ukraine and question the durability of US guarantees, many NATO allies increasingly see Turkey not only as a military bulwark on the alliance's south-eastern flank but also as a potential industrial partner.

Ankara hopes hosting US President Donald Trump and other NATO leaders at a summit next month will help expand arms sales and joint production in Western markets, particularly the European Union. There, Turkish firms face structural barriers including members-only defence initiatives and political resistance tied to broader diplomatic disputes.

A Reuters review of trade figures shows Turkish defence exports - including the high-profile armed drones used by Ukrainian forces - have more than tripled since 2021 to $10 billion last year, accounting for about 3.7% of total exports from the major emerging market economy.

Exports to Europe and the US almost quadrupled over the same period to $5.6 billion.

That growth reflects a maturing domestic defence industry that includes drone-maker Baykar, Turkish Aerospace Industries, and smaller firms such as Arca Defense and Kale.

Analysts say sustained state backing, flexible supply chains and a willingness to customise systems for buyers have allowed such firms to move quickly into markets where Western suppliers face capacity constraints or lengthy procurement cycles.

War threats and opportunities

Turkey aims to double defence exports in two years, its defence agency says, potentially generating vital revenues as it looks to pay down debt and fund further development.

Sitting between two major conflicts - Ukraine to the north and Iran to the south-east - Turkey's own security is also at stake, given its gaps in air defences and jet and tank engines that could be addressed through trade and technology deals.

Can Kasapoglu, senior fellow at the Hudson Institute, said Turkey's defence industry had made a "major leap" by exporting advanced systems, especially aerial drones.

The war in Ukraine, he said, underscored that modern warfare depended not only on cutting-edge platforms but also on industrial depth and sustainability - areas where Turkey has gained credibility.

Nato summit showcase

Turkey supplies about 65% of armed drones used worldwide and is a major exporter of ammunition. It also produces, or plans to produce, frigates, an aircraft carrier, air defence systems and armoured vehicles. Indonesia said last year it would buy 48 Turkish fighter jets currently under development.

Turkey's ambitions also carry political and reputational risks. Last month, it unveiled a prototype domestic intercontinental ballistic missile at a defence show in Istanbul, prompting criticism from some experts over feasibility and messaging after a promotional video depicted a hypothetical launch that appeared to target North America.

Turkish officials say the defence sector will be a focal point at the NATO meeting in Ankara on 7–8 July. Alliance chief Mark Rutte has said a planned defence industry forum there would be NATO's most comprehensive yet.

Experts, bankers, academics and policymakers yesterday called for the formation of a dedicated reform commission for the banking sector, warning that years of politically backed bank takeovers, weak oversight and regulatory failures have eroded public confidence in the financial system.

The call was made at a seminar titled “Good Governance in the Banking Sector and the Role of the Media”, organised by the Economic Reporters’ Forum (ERF) at its office in Paltan, Dhaka.

Speaking as the chief guest, Information and Broadcasting Minister Zahir Uddin Swapon said the government would bring banking sector reforms under a dedicated commission.

“When commissions have been formed for the media, anti-corruption efforts, and administrative reforms, why should such an important sector be left out? We will certainly do it,” he said.

He added that good governance in the banking sector cannot be achieved without broader reforms in the state and political system. He alleged that economic data had been manipulated in the past to hide the true condition of the economy.

“Without support from the state, it would not have been possible to alter performance-related statistics and information in this way,” he said.

Swapon also stressed the need to reduce the economy’s heavy reliance on bank financing and develop a stronger capital market.

At the seminar, Mohammad Mamdudur Rashid, managing director and CEO of United Commercial Bank (UCB), said the sector is facing multiple challenges due to governance failures, although some banks have continued to perform well.

He added that the industry had also been affected by the Covid-19 pandemic, the Russia-Ukraine war and developments after August 2024.

According to Rashid, accountability and transparency are the two foundations of good governance.

“The ratio of non-performing loans rose from 11 percent to 25 percent mainly because of greater transparency. In 2025, Bangladesh Bank instructed banks to disclose the actual figures, making the true picture visible,” he said.

He also said vested interests and weak ethics contributed to current problems, adding that the media had helped expose irregularities long before they became widely acknowledged. However, he warned that inaccurate reporting could weaken depositor confidence.

Shamsul Huq Zahid, editor of The Financial Express, said Bangladesh has too many banks.

“If the economy needed 15 banks, licenses were issued for around 60. Supervising such a large number of banks has become difficult,” he said, adding that comprehensive reforms are urgently needed.

DEPOSITORS’ HARDSHIP AND REGULATORY CONCERNS

Md Shahidul Islam Zahid, professor and chairman of the Department of Banking and Insurance at the University of Dhaka, said depositors are now being forced to queue up to access their own money, which shows the depth of the sector’s problems.

“We tried to build a strong economy while hiding enormous amounts of dirt under the carpet. The question is: where were the regulators?” he said.

He criticised regulators’ role during politically backed bank takeovers and questioned why Bangladesh Bank did not raise public concerns at the time.

Referring to audit irregularities, he said some banks reported profits that later turned into losses after independent audits.

“In one case, a bank reported a profit of Tk 450 crore in 2023, but an audit later found it had actually incurred a loss of Tk 250 crore. Such manipulation involved top-tier auditors and received regulatory approval,” he said, calling for accountability for all parties involved.

Md Ezazul Islam, director general of the Bangladesh Institute of Bank Management (BIBM), said shareholders provide only about 4 percent of funds in the banking sector, while depositors supply the remaining 96 percent.

“Yet those who own just 4 percent effectively control the banks, while depositors who provide most of the funds are struggling to access their money,” he said.

He called for greater autonomy, transparency and accountability at Bangladesh Bank, urging it to fully use its legal powers.

Sayema Haque Bidisha, professor in the Department of Economics at the University of Dhaka, stressed the need for objective analysis of financial data. She also urged the media to closely monitor how the newly announced Tk 60,000 crore stimulus package is used.

As a special guest, Nurun Nahar, deputy governor of Bangladesh Bank, said most bank funds belong to depositors, who keep their money in banks based on trust.

“When people cannot withdraw their money when needed, a crisis arises,” she said.

She said some borrowers take loans without any intention of repaying them and are identified as wilful defaulters. She stressed the need for regular inspections and effective implementation of inspection reports to prevent irregularities.

She also acknowledged that many banking sector scandals were first exposed through media reports, adding that misuse or embezzlement of public money can never be justified.

Masrur Riyaz, chairman of Policy Exchange Bangladesh, also spoke at the event.

The keynote paper was jointly presented by Obaidullah Rony, special correspondent of Samakal, and Sanaullah Sakib, senior reporter of Prothom Alo.

The seminar was chaired by ERF President Doulot Akter Mala and moderated by ERF General Secretary Abul Kashem.

Gold fell about 3 percent on Friday after a stronger-than-expected US jobs report reinforced expectations that ‌the Federal Reserve will keep interest rates higher for longer amid inflation concerns fuelled by the war in the Middle East.

Spot gold was down 2.96 percent at $4,341.52 per ounce at 1:44 p.m. EDT (1744 GMT), after falling ​to its lowest level since March 24 earlier in the session. Bullion was down ​about 4.3 percent this week.

US gold futures for August delivery settled 3.1 percent lower at $4,365.3.

Nonfarm ⁠payrolls increased by 172,000 jobs in May after rising by an upwardly revised 179,000 ​in April, the US Labor Department’s Bureau of Labor Statistics said in its report. A Reuters ​poll had forecast a gain of 85,000 jobs after a previously reported rise of 115,000 in April.

“We’ve got payrolls that came in fairly significantly over what was expected,” said Bart Melek, global head of commodity strategy ​at TD Securities.

“In light of the fact that we continue to have the war in ​Iran and very large energy prices and inflationary pressures, it makes it quite unlikely that the Fed is ‌in ⁠any mood whatsoever to lower rates. The implication for gold here is that the cost of carry is getting quite high.”

US Treasury yields jumped after the release of the jobs data, increasing the opportunity cost of holding non-yielding bullion.

The price of Brent crude oil was on track ​for a weekly gain. ​Bullion has fallen more ⁠than 17 percent since the US-backed war with Iran began in late February. The conflict has led to a surge in oil prices and stoked fears of ​inflation and higher interest rates.

Although gold is seen as an inflation hedge, ​higher rates tend ⁠to weigh on the metal. Markets are currently pricing about a 72 percent chance of a Fed rate hike in December, according to CME Group’s FedWatch tool, compared to about 50 percent before the jobs data.

Gold demand ⁠was ​subdued in India this week, while premiums in China ​eased.

Bangladesh Bank (BB) on Sunday launched a Tk 30 billion (Tk 3,000 crore) export diversification refinance scheme aimed at strengthening production capacity and expanding the country’s export base beyond the ready-made garments (RMG) sector.

The Sustainable Finance Department of the central bank issued a circular in this regard, saying the scheme has been introduced to address product and market concentration risks arising from Bangladesh’s heavy dependence on RMG exports and to support the development of high-potential export sectors.

According to the circular, the refinance fund will be formed from the excess liquidity of scheduled banks and will operate as a revolving fund.

Bangladesh Bank will provide refinancing to participating financial institutions (PFIs) at an interest rate of 4 percent, while exporters will receive financing at a maximum rate of 7 percent.

The tenure of the facility has been fixed at three years, including a grace period of up to six months, with interest calculated under the reducing balance method.

The central bank said the scheme is designed to enhance export competitiveness, increase foreign exchange earnings, improve the country’s trade balance and create employment opportunities through the expansion of non-traditional export sectors.

Financing under the scheme will be available to industries identified as “Highest Priority” and “Special Development” sectors under the Export Policy 2024-27.

Preference will be given to exporters using locally sourced raw materials, while sectors such as jute and leather have been highlighted as key areas for export diversification.

The circular stipulates that exporters classified as loan defaulters in Credit Information Bureau (CIB) reports, businesses with overdue export proceeds and entities with a history of loan write-offs will not be eligible for financing under the scheme.

Banks and financial institutions willing to participate must sign a Participation Agreement with Bangladesh Bank’s Sustainable Finance Department.

Islamic banks will also be eligible to provide financing through Shariah-compliant investment modes, subject to compliance with the scheme’s pricing and tenure requirements.

To obtain refinancing, PFIs will have to submit applications for each disbursement within 90 days along with required documents, including demand promissory notes, letters of continuity, debit authority letters and updated CIB reports.

A minimum debt-equity ratio of 70:30 will be maintained for all investments financed under the facility.

The central bank has also introduced strict monitoring and accountability measures. PFIs will be required to submit quarterly reports within 15 days of the end of each quarter, while Bangladesh Bank will conduct regular inspections to ensure proper utilization of funds.

Under the penalty provisions, PFIs found providing false information or allowing misuse of funds will be charged a five percent penalty interest in addition to the normal refinance rate.

The amount will be recovered directly from the institution’s current account maintained with Bangladesh Bank.

The circular further states that if a borrower becomes classified as a defaulter, the concerned PFI must immediately inform the central bank.

In such cases, Bangladesh Bank may recover the entire outstanding refinance amount from the institution’s current account through a one-time deduction.

The scheme has been introduced under the powers conferred by Section 45 of the Bank Company Act, 1991, as amended in 2023, and has come into effect immediately.

Oil ​prices fell on Friday as traders gained confidence that renewed conflict between the US and Iran ‌was growing less likely.

Brent crude futures settled at $93.09 a barrel, down $1.94 or 2.04 percent. The previous session, Brent settled 2.84 percent lower.

US West Texas Intermediate crude finished at $90.54 a barrel, down $2.50, or 2.69 percent, following a 3.1 percent loss on Thursday.

“The market is not seeing ​escalation between the parties,” said Phil Flynn, senior analyst at Price Futures Group. “Even though we don’t ​have a deal, it seems the market is seeing a de-escalation.”

Petroleum Development Oman said operations at Mina al Fahal port were unaffected after three sources told Reuters that oil loading had been ​suspended following an explosion near its mooring berths. Oman exports 800,000 to 900,000 barrels per day of crude from the ​terminal.

Both contracts still looked set to post their first weekly gains in three weeks, with Brent up 1.18 percent and WTI around 3.64 percent.

The contracts rose earlier in the week after fighting flared in the Middle East as US-Iran war peace talks dragged ​on while traffic in the Strait of Hormuz, where a fifth of the world’s oil passes, remained limited.

“As ​hopes for an agreement between the US and Iran were dashed once again, the price of Brent crude and European ‌natural gas rose slightly this week,” Commerzbank analysts said on Friday.

However, Brent’s gains have been capped by oil inventories lasting longer than expected, rerouted exports and falling demand, Commerzbank added.

Hezbollah leader Naim Qassem rejected on Thursday a US-brokered agreement between Israel and the Lebanese government to halt the fighting. Iran has made a ceasefire in Lebanon a ​condition for any peace deal ​with Washington.US President Donald ⁠Trump said on Thursday he believed progress was being made between Israel and Lebanon and that Lebanon deserved to have peace.

“Any optimism remains heavily clouded by a ​tangled web of headlines and counter-headlines,” IG market analyst Tony Sycamore said in ​a note.

Opec is ⁠sticking to its oil demand growth forecast of 1.2 million bpd for this year, Secretary General Haitham Al Ghais said on Thursday, despite the Middle East conflict and closure of the Strait of Hormuz.

Iranian oil exports have fallen to their ⁠lowest level ​in six years mainly due to the US naval blockade, according ​to shipping data, although weak demand in China has depressed prices for the oil.

Bitcoin dropped below $60,000 on Friday, its lowest level since October 2024, just before Donald Trump’s election, which propelled it to a record high.

The currency fell by about 6 percent around 1615 GMT, to $59.7709, before paring its losses slightly.

The election of Trump, a staunch advocate of cryptocurrencies, to the White House for a second term in November 2024 sparked a wave of enthusiasm in the sector, sending the price of bitcoin soaring to nearly $110,000.

The current dip has been caused by factors including one corporate selloff, according to Emma Bernuau, a consultant at Eurosagency.

A surprise sale by Strategy -- one of bitcoin’s most prominent corporate holders -- rattled confidence. The firm revealed it had sold 32 BTC from its reserves, the first such disposal in several years.

“Although the amount was minimal, the symbolic significance is considerable,” Bernuau said.

“The market had generally considered that Strategy had no intention of selling its bitcoin and would continue accumulating regardless of market conditions.”

Bernuau said long-term investors could view the dip as a buying opportunity, and flagged several potential tailwinds including progress on US legislation to support the sector.

The benchmark index of the Dhaka Stock Exchange (DSE) rose sharply in early trading today (7 June), following the appointment of the new chairman of the Bangladesh Securities and Exchange Commission (BSEC), who assumed office on Thursday.

During the opening session up to 10:10am, the DSEX gained 73 points to reach 5,548, its highest level in the past three months.

The blue-chip DS30 index also posted strong gains, rising 29 points to 2,097.

Of the traded securities, 298 advanced, while 34 declined and 34 remained unchanged.

Turnover during the session stood at Tk213 crore.

Market insiders attributed the rally to renewed investor confidence following the appointment of the new BSEC chairman.

They expressed optimism that the newly appointed chairman, Masud Khan, would play an important role in restoring stability and confidence in the capital market.

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) will hold an emergency board meeting today to review the persistent decline in garment exports.

The meeting, to be held at the BGMEA office in Uttara, Dhaka, will primarily focus on the export downturn, BGMEA Director Faisal Samad said. It will also discuss the recent closure of several garment factories and the factors behind them.

The association will also engage with the government to address the challenges facing the garment sector and stem the decline in exports, he said.

Garment exports have been falling for nearly a year, Samad said, driven not only by tariff-related issues but also by geopolitical tensions, longer lead times and challenges associated with the country’s graduation from least-developed country (LDC) status.

In the July-May period of fiscal year 2025-26, garment exports totalled $35.31 billion, marking a 3.41 percent decline from $36.56 billion in the corresponding period of fiscal year 2024-25, according to data from the Export Promotion Bureau.

The meeting is also likely to discuss the US tariff issue, BGMEA President Mahmud Hasan Khan said, as it has created uncertainty among businesses.

A fund will also be created for members so that it can be used in emergencies, he said.

A major European clothing retailer operating in Bangladesh said, requesting anonymity, that the outlook for garment exports may not improve significantly in the next season due to continued volatility in the global market.

The longer lead time is a major problem in Bangladesh, he said. Shipments from Bangladesh take 30 to 40 days to reach Europe, and in some cases even longer. Longer lead times also increase operational costs, making it difficult for manufacturers to remain profitable on thin margins.

Bangladesh should sign a free trade agreement with the European Union or negotiate to secure GSP+ status, as preferential market access to the EU will end following the country’s LDC graduation, he suggested.

OpenAI is planning its biggest ChatGPT overhaul yet, aiming to turn it into a "superapp" with coding tools and AI agents to boost revenue ahead of a potential stock market listing, the Financial Times reported on Sunday.

The changes are part of a broader reorganisation at OpenAI, as it shifts resources to target lucrative enterprise clients and intensify competition with rival Anthropic, the report said, citing more than a dozen current and former employees.

Reuters could not immediately verify the report. OpenAI did not immediately respond to Reuters' request for comment.

The overhaul will give greater prominence and resources to OpenAI's coding product Codex and is set to roll out in the coming weeks, initially appearing as updates to ChatGPT's website and mobile apps, the FT said.

To drive uptake, OpenAI is redesigning ChatGPT's interface with new prompts and features steering users towards coding tools, image generation and partner services such as Canva and Booking.com, the report added.

Most Codex users are paying customers, while 2 million businesses account for about 40% of OpenAI's revenue, FT said, adding that the company expects that share to rise to 50% by year-end.

ChatGPT serves more than 900 million weekly active users, OpenAI said earlier this year, adding that it had surpassed 50 million consumer subscribers.

Reuters reported in May that OpenAI was preparing a confidential US IPO filing in the coming weeks. However, CEO Sam Altman has said the company is not focused on timing and will go public when it makes sense.

Bangladesh Securities and Exchange Commission (BSEC) Chairman Masud Khan said the regulator would take an aggressive approach to attract quality companies to the stock market, arguing that such a move is necessary to build a more stable and mature capital market.

Speaking at the 10th anniversary event of CFA Society Bangladesh at Sheraton Dhaka on Saturday, Khan said the market currently suffers from a shortage of quality stocks, while a significant share of trading remains concentrated in weak and speculative shares.

“We have to bring very good scripts into the market, very quickly,” he said, stressing that investors need access to more fundamentally sound companies.

The BSEC is exploring various incentives to encourage strong companies to go public. While tax incentives remain an option that would require discussions with the National Board of Revenue (NBR), he suggested several administrative measures that could make listing more attractive.

Among the proposals, Khan floated the idea of creating a separate tax administration framework for listed companies, arguing that compliant listed firms should face fewer regulatory burdens than unlisted entities.

Khan also highlighted the long-term benefits of listing, saying publicly traded companies tend to become stronger institutions through improved governance, professional management and succession planning.

He further revealed plans to promote direct listings, particularly for multinational corporations, well-governed banks, state-owned enterprises and reputable local companies.

According to him, direct listings could quickly increase the supply of quality shares in the market without requiring companies to raise fresh capital.

Noting that Bangladesh remains heavily reliant on retail investors, Khan emphasised the need to strengthen institutional participation in the stock market. He said deeper involvement by pension, provident and gratuity funds would help the market progress from frontier-market status towards emerging-market standards.

The chairman argued that stronger institutional investment, alongside the listing of quality companies, is essential for creating a more stable and mature capital market.

He also called for major regulatory simplification and digitisation, saying the existing regulations governing IPOs, margin loans and mutual funds have become unnecessarily complex. Applications for IPOs and rights issues should be fully automated, he said, adding that regulators should “regulate where necessary and simplify where possible.”

Asif Khan, president of the society, and M Masrur Reaz, chairman and chief executive officer of Policy Exchange Bangladesh, also spoke at the event.

Formal credit growth in the private sector remains almost static, reaching 4.75 per cent in April, signalling a deep slowdown in the country's business activities.

The low trend in credit demand from private enterprises is attributed to banks becoming more cautious amid rising non-performing loans (NPLs) and private borrowers losing their credit appetite due to multiple anti-business factors, including the energy crisis, higher lending costs, and external shocks stemming from the Middle East crisis.

The Bangladesh Bank's (BB) private sector credit growth data, available since 2003, shows April growth was the second-lowest after the previous month's count of 4.72 per cent.

According to the BB, outstanding loans taken by private sector entrepreneurs reached Tk 18.03 trillion by the end of April, up 4.75 per cent from Tk 17.22 trillion a year earlier.

In fact, private credit growth has hovered around single digits since August 2024, reflecting prolonged sluggishness in the $460 billion economy that is largely private-sector-led.

Seeking anonymity, a central bank official says the banking regulator continues its contractionary monetary policy stance, keeping the policy rate at 10 per cent as part of its inflation control measures despite criticisms from business circles.

"The higher lending rate, energy crisis, and external shocks stemming from the Middle East crisis are major reasons behind the plummeting credit demand," he says.

He mentions the half-yearly monetary policy statement (MPS) projection for private credit growth up to June next year is 8.50 per cent, but the current growth remains below that.

However, growth could pick up in the last quarter of FY26, he adds.

President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Mohammad Hatem says entrepreneurs are struggling to survive in the market under the extreme business and investment climate that prevails.

He cites multiple factors like the prolonged energy crisis, higher borrowing costs, and anti-business taxation policy, saying these are making it difficult for businesspeople to survive.

"Under such circumstances, who dares to think of business expansion? I do not know how the growth (4.75 per cent) has happened and who the borrowers are. Will they be able to repay the loans? I have enough doubts," he adds.

India has hiked domestic cooking gas price by Rs 29 per cylinder, in the second increase in three months as state-owned fuel retailers continue to grapple with elevated global energy costs due to West Asia conflict.

The price of a 14.2-kg domestic cooking gas cylinder in Delhi will rise to Rs 942 from Rs 913 with effect from 7 June, Indian media reported today citing industry sources.

The latest increase follows a Rs 60-per-cylinder hike on 7 March after the conflict in West Asia disrupted global energy supplies and drove up international fuel prices.

Industry sources said the increase had only partly offset losses incurred on domestic LPG sales.

Petrol and diesel prices have been raised by a cumulative Rs 7.50 per litre since mid-May while compressed natural gas (CNG) rates were increased by around Rs 6 per kg.

Meanwhile, the Petroleum And Natural Gas Ministry said in a statement today recipients of subsidized cooking gas under a special scheme for women will receive Rs 300 a cylinder on the first four refills each year.

The effective cooking gas price under the subsidized scheme for women for the first four cylinders at Rs 642 is at a discount of about 60% to the actual international price of an LPG cylinder, it said.

The statement said cooking gas cylinders in India are cheaper than in any neighbouring country and far below the price in advanced economies such as the United States, Australia and Canada.

The cost of supplying a cylinder has risen to over Rs 1,600, an under-recovery of about Rs 700 on each domestic cylinder.

The prices of petroleum products in India are linked to the corresponding prices in the international market.

What the household does not bear the brunt of is the several hundred rupees a cylinder which the government is bearing.

As the West Asia conflict tightened the Strait of Hormuz, through which roughly a fifth of the world's oil and a large share of India's energy imports pass, most commercial traffic in the waterway was brought to a near halt.

About 54 per cent of India's LPG consumption was routed through the Strait, leaving the cooking-gas supply directly exposed to the disruption.

However, India was among the few that kept its energy cargoes moving. In fact, India brought out the largest number of energy-carrying without paying any toll.

Besides, sourcing was widened to suppliers across the world, including those that do not route through the Hormuz Strait, like the United States, Canada and Algeria and available LPG was directed to households and to priority users such as hospitals and educational institutions.

The ministry said measures were taken to secure supply through the disruption. On the supply side, domestic LPG production was raised by more than 60 per cent to offset the constrained imports.

With an upscale new budget coming in few days now, the government targets borrowing 8.0-percent higher from the banking sector and 20-percent bigger from savings schemes to finance deficit amid unpromising revenue-earning prospects, officials say.

According to Finance Division sources, in the next fiscal year, the government plans to borrow some Tk 1.12 trillion from banks compared to current year's budgetary target of Tk 1.04 trillion.

Data show that until May 10, the government had actually borrowed Tk 1.95 trillion from the banking sector to meet its needs.

Also, the government is targeting to borrow some Tk 150 billion from the national savings schemes to help finance the Tk 9.38-trillion largest-ever fiscal budget in Bangladesh.

In the outgoing fiscal year, the government had targeted borrowing Tk 125 billion from national savings schemes. However, due to selling pressure from the buyers, the government's net selling of savings instruments fell into negative territory by Tk 5.55 billion until February last.

Officials say that as the government is making a large-size budget without confirming adequate sources of earnings, it will have no option but to raise dependence on the banking sector to meet its financial needs.

In the next year's budget, the government is setting a target of collecting Tk 6.95 trillion as revenues, compared to its highest revenue collection in the recent past amounting to Tk 4.09 trillion.

The finance officials say the National Board of Revenue (NBR) alone is going to be given a target to collect Tk 6.04 trillion, higher by Tk 2.43 trillion than its previous records in revenue mobilisation.

So, they say, as revenue collection will fall short of its target and foreign fund flow is not promising in the coming year, government's net bank borrowings will mount in the next fiscal year, surpassing the target.

Dr Zahid Hussain, a former lead economist at the World Bank's Dhaka office, says it seems that "debt trap is now a matter of time" as the government is increasingly depending on loans instead of enhancing revenue earnings.

"The money the government is borrowing from the banks is being used for meeting its operational needs instead of using them in productive sectors," the economist notes.

Thus, he adds, the government's debt burden is increasing day by day.

Because, he says, the government will have to return the money with interest.

Mr Hussain also makes a point that high government borrowing from banking sector lessens fund flow for private-sector investment, thus lowering employment growth that ultimately impacts overall economic growth in the country.

OPEC+ is set to agree on Sunday a fourth increase in oil output targets in as many months, three OPEC+ sources said, even though the US war with Iran is still preventing several of the group's members from pumping more.

The war has cut oil flows via the Strait of Hormuz, creating the world's biggest ever supply crisis as key OPEC+ members including Saudi Arabia have been unable to supply customers in full since the end of February. The crisis for OPEC+ deepened when the United Arab Emirates left the Organization of the Petroleum Exporting Countries after almost 60 years.

Seven core members of OPEC+, which groups OPEC and allied producers including Russia, have increased their output quotas from April to June by almost 600,000 barrels per day.

In reality, the group's production has collapsed due to export cuts by Gulf members, averaging 33.19 million bpd in April versus 42.77 million in February, according to OPEC figures.

On Sunday, the seven members will likely increase targets by about 188,000 bpd from July, the sources said. This is the same as the June hike, which was adjusted down from monthly increases of 206,000 bpd in May and April to take into account the UAE exit.

All the sources spoke on condition of anonymity and said a final decision had not been made.

The seven of 21 OPEC+ members due to meet on Sunday are Saudi Arabia, Iraq, Kuwait, Algeria, Kazakhstan, Russia, and Oman.

A full OPEC+ ministerial meeting is also scheduled for Sunday but is not expected to make any policy changes, the sources said.

The National Board of Revenue (NBR) is considering reducing the source tax on a range of non-core supply items – including packaging materials, office stationery, and administrative and marketing-related goods used in local industry and service sectors – from 5% to 4%. The advance income tax (AIT) levied at the import stage may also be trimmed by one percentage point.

A senior NBR official, speaking on condition of anonymity, said the proposal has been shaped by business demands and is expected to feature in the upcoming budget. "This may reduce costs for businesses and, ultimately, help protect consumers from rising prices of goods and services."

The move follows remarks by NBR Chairman Abdur Rahman Khan in March, when he signalled that source tax rates across sectors would be rationalised and aligned with firm and industry profitability to minimise refund complications.

Under the current framework, excess source tax deducted at the supply stage can be offset against future profits. In practice, however, many firms either fail to claim such adjustments or avoid doing so because of procedural complexity. The result: companies frequently pass on the burden through higher prices, while others underreport income to ease compliance pressure.

Business leaders and tax experts have broadly welcomed the proposal.

Debabrata Roy Chowdhury, Director of Nestlé Bangladesh, called it a positive development. "We deduct tax from our suppliers and deposit it. But at the current rate, suppliers need to earn more than 20% profit to absorb it, which is not realistic. They cannot adjust it, so they pass it on through higher prices," he told TBS.

Another entrepreneur noted that while compliant firms properly deduct and remit taxes, a significant portion of the market underreports income to sidestep the burden – a trend the higher rate has helped entrench. Chowdhury added that at the 5% rate, a substantial sum is withheld annually at the supply stage, squeezing cash flows across the chain.

Tax experts are calling for further refinement, suggesting that source tax rates be calibrated against corporate profitability based on financial statement analysis. They note that the rollout of the Document Verification System (DVS) has improved transparency, making such fine-tuning more feasible.

Snehasish Barua, managing director of SMAC Advisory Limited, backed the proposal, describing the cut as beneficial for both businesses and consumers. "Lowering the upfront tax on imports and supplies from 5% to 4% directly solves a major corporate headache: trapped cash flow," he said, adding that easing upfront tax pressure would improve liquidity, reduce transactional friction, and strengthen compliance.

On the question of fiscal impact, Barua acknowledged a likely short-term dip in revenue but argued that improved efficiency and stronger compliance would offset it over time. "With inflation squeezing everyday budgets, this policy acts as a shield against rising prices," he said.

Source tax collections currently account for more than 60% of the government's income tax revenue, though a detailed breakdown between local supply deductions and import-stage AIT is not publicly available.

According to NBR's 2022-23 financial statement, Tk15,728 crore was collected at the local supply stage and Tk11,866 crore at the import stage – a combined figure that experts say is substantially tied to the prevailing 5% rate.

Bangladesh’s point-to-point inflation rose to 9.42 per cent in May 2026, driven mainly by an increase in food prices, according to the latest data released by the Bangladesh Bureau of Statistics (BBS).

The inflation rate was 9.04 per cent in April 2026 and 9.05 per cent in May last year.

Food inflation climbed to 9.06 per cent in May from 8.39 per cent in April. The rate was 8.59 per cent in May 2025.

Non-food inflation also increased slightly to 9.71 per cent in May from 9.57 per cent in the previous month. It was 9.42 per cent in the same month a year ago.

Meanwhile, the 12-month moving average inflation declined to 8.63 per cent during the July 2025-May 2026 period, compared to 10.13 per cent recorded in the corresponding period a year earlier.

The BBS data showed that inflation increased in both rural and urban areas in May.

In rural areas, the general inflation rate rose to 9.48 per cent in May from 9.05 per cent in April. Food inflation in rural areas stood at 8.95 per cent, while non-food inflation was 9.98 per cent.

In urban areas, the general inflation rate increased to 9.25 per cent in May from 9.02 per cent in April. Urban food inflation stood at 9.29 per cent and non-food inflation at 9.24 per cent.

The latest inflation data came at a time when consumers across the country continue to face pressure from elevated prices of essential commodities and household expenses.