The country's equity market suffered a sharp pullback last week as persistent concerns over an ongoing energy crisis, a weakening corporate earnings outlook, and fragile investor sentiment continued to weigh heavily on trading activity.

The benchmark DSEX index of the Dhaka Stock Exchange plummeted by 146 points, or 2.59%, to settle at 5,515. Mirroring the broader market slump, the blue-chip DS30 index dropped 45 points, or 2.12%, to close at 2,095. Overall market capitalisation contracted significantly, wiping out Tk5,400 crore over the week.

Broad-based selling pressure dominated the floor, resulting in 310 issues declining against only 60 advancing, while 16 remained unchanged.

Daily average turnover on the Dhaka bourse dropped 9% to Tk554 crore, reflecting cautious participation from both institutional and retail investors.

According to a weekly market review by EBL Securities, the capital bourse ended the week in negative territory as investors remained wary of the adverse impact of persistent gas and electricity shortages on industrial production and corporate profitability.

The week opened on a subdued note, with the prolonged bearish trend dragging the intraday DSEX index below the 5,500-point mark. Although bargain hunters attempted to stage a reversal mid-week as declining stock valuations offered attractive entry points, broader concerns over macroeconomic uncertainty quickly outweighed buying interest, sustaining the downward momentum through subsequent sessions.

Sheltech Brokerage Limited noted in its weekly report that the market performance was primarily shaped by strong initial selling pressure, which led to the sharpest single-session decline seen in the last five months. While opportunistic buying emerged toward the middle of the week, it failed to trigger a meaningful recovery and was eventually offset by persistent profit-booking and risk aversion.

Investor activity was heavily concentrated in the textile sector, which accounted for 29.5% of total turnover, followed by general insurance at 14.2% and pharmaceuticals at 10.4%.

Sector-wise performance was overwhelmingly negative across the board. The ceramics sector suffered the steepest decline, falling 5.9%, followed by paper and life insurance, which dropped 5.6% and 5% respectively.

Amid the widespread downturn, the mutual fund sector stood out as a notable exception, gaining 3.7% as short-term-oriented investors sought quick-gain opportunities.

Top turnover leaders for the week included Sharp Industries, Envoy Textile, Malek Spinning, Saiham Cotton, and Saiham Textile.

Envoy Textile led the weekly gainers' chart with a 20.4% surge, followed by Phoenix Finance First Mutual Fund at 20.3%, Exim Bank First Mutual Fund at 13.8%, Mercantile Insurance at 11.8%, and Reliance Insurance Mutual Fund One at 10.6%.

Conversely, Al-Haj Textile emerged as the top loser, tumbling 16.9%, alongside Information Service Network, Orion Infusion, Samata Leather, and Desh Garments.

The British Bangladesh Chamber of Commerce and Industry (BBCCCI) plans to establish a British-Bangladesh Trade Centre in London to strengthen trade, investment and business ties between Bangladesh and the United Kingdom.

The proposed centre will connect businesses from both countries, facilitate investment and help build commercial partnerships, the chamber said in a press release yesterday (12 September).

The announcement was made at the BBCCCI Business Reception 2026 and the inauguration of its newly elected committee at the Ivy Hill Hotel in London.

The trade centre will support businesses seeking to enter the Bangladesh and UK markets and organise programmes focused on trade, investment, entrepreneurship development and bilateral business cooperation, according to the chamber.

"The main objective is to turn connections between British and Bangladeshi businesses into trade and create new business opportunities," BBCCCI Director General Musleh Ahmed said.

He said the centre would help businesses identify potential partners, explore new markets and expand their operations through joint ventures and other forms of cooperation.

BBCCCI President Muhib Chowdhury said the proposed centre reflected the chamber's commitment to building a modern and ambitious organisation.

He said the BBCCCI would play a leading role in strengthening commercial relations between Bangladesh and the UK.

M Nazrul Islam, Bangladesh's acting high commissioner to the UK, was the keynote speaker at the event.

The chamber said growing interest among businesses in accessing international markets, exploring investment opportunities and building strategic partnerships had created a need for stronger institutional support.

It expects the proposed trade centre to deepen economic relations between Bangladesh and the UK and potentially become an important hub for bilateral trade and investment.

BBCCCI advisers, members of the chamber's election commission, businesspeople, professionals, journalists and representatives of various professional organisations attended the programme.

BRICS leaders have called for a revamp of the global governance system, condemned unilateral tariffs and "acts of war", and backed greater representation for developing countries at the United Nations Security Council (UNSC).

The positions were outlined in the New Delhi Declaration adopted today (12 September) at the BRICS Summit in the Indian capital, where Indian Prime Minister Narendra Modi announced the consensus document, reports NDTV.

The declaration called for a "structural update" of the UNSC, with greater representation for developing countries from Africa, Asia, Latin America and the Caribbean.

China and Russia, the two permanent members of the Security Council represented at the summit, reiterated their support for Brazil and India seeking a greater role at the UN, including on the Security Council.

"Today's discussion makes it evident that the changing world cannot be steered by outdated institutions; reforms are essential in representation, responsiveness and rule-making," Modi said in his concluding remarks.

He also stressed that the Global South should have an equal role in shaping future technologies and the rules governing them.

The declaration urged BRICS members to increase the use of local currencies in trade among themselves, reducing reliance on the US dollar.

Tariff concerns

The bloc also criticised the growing use of tariffs and other trade restrictions, reaffirming its support for reform of the World Trade Organization (WTO).

BRICS said the global trading system should remain open, transparent, equitable and rules-based, while expressing "serious concerns" over unilateral tariff and non-tariff measures that it said were inconsistent with WTO rules.

It warned that such measures could hamper global trade, disrupt supply chains and create uncertainty for international economic activity, while worsening existing economic disparities.

The group said it would work to make the WTO more responsive to trade disruptions and the needs of emerging markets and developing economies.

Condemnation of terrorism

The declaration strongly condemned terrorism in all its forms and reaffirmed the bloc's commitment to tackling terrorist financing, safe havens and the cross-border movement of terrorists.

"We express strong condemnation of any acts of terrorism as criminal and unjustifiable, regardless of their motivation, whenever, wherever and by whomsoever committed," the declaration said.

BRICS also stressed that terrorism should not be associated with any religion, nationality, civilisation or ethnic group, and said those involved in terrorist activities and their support should be held accountable under national and international law.

The declaration further denounced "unilateral acts of war" and stressed the importance of protecting seafarers and commercial navigation amid ongoing military aggression in the Middle East.

The summit comes as BRICS marks two decades since its creation and follows the group's expansion beyond its original membership.

Pubali Bank PLC's board of directors has recommended doubling the bank's authorised capital to Tk4,000 crore from Tk2,000 crore, subject to approval from shareholders and Bangladesh Bank.

The decision was taken at a board meeting held today (10 September).

To facilitate the increase, the bank will raise its total number of ordinary shares to 400 crore from 200 crore, with a face value of Tk10 each. The board has also proposed amendments to relevant provisions of the bank's Memorandum and Articles of Association.

The proposals will be placed before an Extraordinary General Meeting (EGM) scheduled for 25 October, which will be held virtually through a digital platform. The record date for the EGM has been set for 29 September.

Following the price-sensitive disclosure on the Dhaka Stock Exchange, Pubali Bank shares remained unchanged at Tk37.70 today.

Earlier, Pubali Bank posted robust financial growth in the second quarter and first half of 2026. The bank's consolidated earnings per share (EPS) rose to Tk2.95 for April–June 2026, from a restated Tk2.51 in the same period a year earlier. For the January–June period, consolidated EPS increased to Tk4.39 from Tk3.70. The bank attributed the growth in earnings to higher investment income, increased commissions, exchange and brokerage fees, and other operating revenues.

Consolidated net operating cash flow per share experienced a notable upward trend, surging to Tk48.78 for January–June 2026 from Tk32.28 in the corresponding period of 2025. This improvement was driven by a strategic focus on high-yield lending, fee diversification, cost optimisation, digital transformation, and increased customer deposit collections.

Additionally, the bank's consolidated net asset value (NAV) per share reached Tk48.90 as of 30 June, 2026, up from a restated Tk45.27 at the end of December 2025, propelled by higher retained earnings and paid-up capital additions from stock dividends.

Bangladesh's electrical and electronics exports are gaining momentum, with shipments of electrical products rising nearly 24% in FY2025-26, even as manufacturers seek to keep pace with increasingly demanding sustainability, traceability, and product-compliance requirements in the European Union.

According to the latest Export Promotion Bureau (EPB) data, exports of electrical products increased 23.82% from $166.52 million a year earlier, reaching a record $206.19 million.

The category was the largest earner among engineering products, surpassing bicycles, which earned $151.04 million, up 29.71%.

Engineering exports overall rose 21.77% to $652.15 million, underscoring the growing contribution of electrical and electronics products to Bangladesh's export diversification.

The growth comes as the European Union introduces new sustainability requirements through its Ecodesign for Sustainable Products Regulation (ESPR) and Digital Product Passport (DPP) framework.

The ESPR entered into force in July 2024, introducing requirements for DPPs and product durability, as well as a ban on destroying certain unsold goods.

The ESPR does not immediately require every electronic product to carry a DPP. Instead, product-specific requirements are being introduced through delegated acts. Where applicable, manufacturers will need to provide information on materials, components, environmental characteristics, durability and repairability.

For Bangladesh, this could prove challenging as manufacturers remain dependent on imported components and raw materials, making supply-chain traceability more difficult.

Industry races to prepare

Mohammad Ali, senior vice-president of the Bangladesh Electrical Merchandise Manufacturers Association (Bemma), said the association was preparing its members through workshops covering product origin, warranties, after-sales service, repairability, and documentation.

"We are already working on a product basis, product origin, product warranty, and after-sales service – whether a product is repairable or not," he said.

But the sector still lacks adequate testing infrastructure, Ali said.

Bemma has approached the commerce and industries ministries several times for support in establishing facilities capable of testing electrical products against European and other Western-market standards.

"For the electrical sector, we think there should be an individual common facility centre," he said.

Such a facility could particularly benefit smaller manufacturers that are beginning to explore export markets.

Imported inputs pose traceability challenge

Supply-chain traceability remains another hurdle, particularly because many manufacturers source components and raw materials from China and Vietnam.

"Most of the raw materials we are importing are from China or Vietnam. In that case, it is actually totally difficult to identify the carbon footprint," Ali said.

Bemma members that have traditionally focused on the domestic market face a steeper learning curve as they move towards exports, he said.

Walton says it can adapt

For leading exporter Walton, adapting to changing international standards is not new.

Syed Al Imran, executive director of Walton Hi-Tech Industries, said the company had repeatedly upgraded its systems as overseas requirements changed, citing the transition from manual registration to the digital Registered Exporter (REX) system and changes in European energy-efficiency ratings.

"When A+++ changed to A, B, C, D and E, Walton instantly upgraded," Al Imran said.

He attributed the company's ability to respond quickly partly to its vertical integration, with Walton manufacturing many of its own parts and components.

Another advantage is Walton's NUSDAT-UTS laboratory, which provides testing and certification services, including CB certificates, he said.

Walton previously had to send refrigerators to India for testing, but NUSDAT-UTS reports are now accepted for the relevant Indian star-rating process, eliminating the need to send products abroad, Al Imran said.

When new requirements emerge, Walton can work with NUSDAT-UTS and partner laboratories to identify necessary upgrades and implement them, he added.

Vision prepares for European entry

PRAN-RFL Group's Vision Electronics is also preparing to enter the European market.

The company currently exports across South Asia, Southeast Asia, Oceania and Africa, while Europe remains a strategic target.

For refrigerators and air conditioners, Vision is redesigning its product architecture to meet European quality, safety and eco-design requirements. It has already secured G-Mark certification for its air-conditioner line for the Middle East.

The company is integrating ERP systems to track raw-material origins, chemical compliance and sub-assembly batches. It is also digitising bills of materials and working with consultants to measure Scope 1, 2 and 3 emissions at its Habiganj and Danga industrial parks.

Its R&D team is moving towards modular PCB designs and quick-release compressor and fan-motor mounts to facilitate repairs and component replacement.

Vision is also replacing some non-recyclable composite plastics with single-grade polymers such as ABS and HIPS, while planning for the long-term availability of key spare parts.

Policy support needed

Bemma says stronger government support is needed to help the broader industry compete internationally.

Ali called for incentives, back-to-back letters of credit and duty relief on imported raw materials, similar to support mechanisms available to the garment sector.

"If we get this kind of government backup in the electrical sector, I think electrical and electronics can be the most promising sector over the next 10 years, even more promising than RMG," he said.

The senior vice-president also urged the commerce, industries and finance ministries to hold sector-specific discussions with electrical manufacturers.

A more immediate regulatory deadline concerns batteries. Under the EU Batteries Regulation, an electronic battery passport will be mandatory from 18 February 2027 for electric-vehicle batteries, industrial batteries above 2kWh and light means of transport batteries placed on the EU market.

For Bangladesh's rapidly expanding electrical and electronics industry, the challenge is moving beyond producing competitive goods to being able to prove how they are made, tested, sourced and repaired.

Bangladesh currently exports a range of consumer electronics and appliances, including televisions, refrigerators, freezers and air conditioners, as well as electrical equipment such as power transformers, electric cables and insulated wires, switches, sockets, circuit breakers and LED lighting solutions.

The export basket also includes rechargeable batteries, transistors and semiconductor devices, along with eco-friendly bicycles and other light mechanical components.

With electrical exports growing at a double-digit rate, manufacturers that build these capabilities early could be better positioned to turn the sector's export growth into a sustained foothold in major global markets.

Bangladesh has 51.83 lakh tonnes of fertiliser in government stocks against a projected demand of 35.20 lakh tonnes through February, leaving a surplus of around 16.63 lakh tonnes, according to the Ministry of Agriculture. Yet farmers in several districts are struggling to buy fertiliser, with some waiting in long queues or paying above government-fixed prices.

The Business Standard found that the disruption lies in the distribution chain after the government began implementing a new dealer policy during peak Aman demand. Existing dealer vacancies, uncertainty over the transition and rumours of dealership cancellations have reduced lifting from warehouses, disrupting last-mile supply to farmers.

The disruption has since led to farmer protests and allegations of overpricing and hoarding, despite adequate fertiliser stocks at the national level.

The agriculture ministry gazetted the Comprehensive Policy on Fertiliser Dealer Appointment and Distribution 2026 on 27 August, seeking to reorganise a system the government says had suffered from discrimination and weaknesses in distribution.

Under the new arrangement, each union can have up to three dealer units. One additional dealer is to be appointed while existing eligible dealers remain, and one person cannot hold more than one dealership. Fresh appointments are also being made against vacant dealer points.

The government says the changes are intended to make fertiliser distribution more efficient, transparent and accessible to farmers.

An unbecoming time

Implementation of the new dealer appointment and distribution system began when Aman cultivation was already under way and fertiliser demand was high, with the Rabi season also approaching.

Officials said work on revising the dealer system began in June, but repeated changes pushed the appointment process into the peak demand period.

Mohammad Hamidur Rahman, former director general of the Department of Agricultural Extension (DAE), said the timing was inappropriate.

"Aman cultivation, the country's main rice crop, starts from the beginning of August. Farmers need a huge amount of fertiliser at this time. But the new dealer appointment process was started at this very time, which was not right. As a result, existing dealers have reduced fertiliser collection from warehouses. Some are not collecting fertiliser at all. This has created the crisis," he said.

The government should have started the dealer appointment process during the off-peak season after assessing the situation, he added.

Rumours over dealerships unsettle distribution

Sector insiders said the policy transition created uncertainty among dealers, while rumours spread that existing dealerships would be cancelled.

The policy itself retained eligible existing dealers, and the agriculture ministry had also issued instructions allowing existing chemical fertiliser retailers to continue operating.

But insiders said the uncertainty was enough to make some dealers reduce or stop lifting fertiliser from government warehouses.

Agriculture Secretary Md Salim Khan acknowledged that internal disputes over the new integrated policy had affected lifting by dealers of the Bangladesh Chemical Industries Corporation (BCIC) and Bangladesh Agricultural Development Corporation (BADC).

He also blamed rumours for creating panic among farmers.

"Effectively, there is no fertiliser shortage. A section of people are artificially creating various incidents. Many rumours have been spread at the district level about fertiliser. They have agitated farmers by spreading the claim that there is no fertiliser," he said.

An already weak dealer network

The policy transition came on top of another problem: thousands of dealer points were already vacant.

State Minister for Local Government Mir Shahe Alam told parliament on 9 September that around 3,759 dealer points had become vacant after dealers appointed under the previous government left their positions. The government plans around 4,918 new appointments as it seeks to fill gaps and expand the network.

The vacancies were not created by the new policy, but agriculturists say they left the distribution network more vulnerable when the government began changing the system during peak demand.

Dealers had sought a delay

The Bangladesh Fertilizer Association (BFA) also raised objections to the timing and implementation of the new policy.

After seeking clarification over provisions it described as unclear, unlawful and contradictory, the association asked the agriculture ministry in September to suspend the dealer appointment process for two months.

The request followed a High Court order asking the ministry to dispose of the BFA's objections within 60 days. The association argued that appointments should remain suspended during that period so the Aman season could be completed without further disruption.

BFA Chairman Md Mosharraf Hossain had separately instructed dealers in August to lift allocated fertiliser on time and sell it at government-fixed prices.

Reduced lifting hits local supply

Agriculture ministry officials said the disruption became more acute after dealers lifted only around half of their allocated fertiliser from government warehouses in July and August.

Officials said agriculture officers in 15 districts failed to report the reduced lifting to the ministry. After two consecutive months of low collection, shortages began appearing in local markets.

The ministry later concluded that some dealers had deliberately refrained from lifting allocations to create an artificial shortage, officials said.

Show-cause notices were subsequently issued to agriculture officials in the affected districts, while some faced withdrawal and stand-release orders.

Agriculture Secretary Md Salim Khan said some farmers were also trying to stock more fertiliser ahead of the Rabi season, adding further pressure on local supply.

Farmers feel the impact

The effect has become visible in districts including Rajshahi, where farmers have repeatedly visited dealer warehouses only to return without fertiliser.

Some supplies are also being sold outside the authorised dealer network at substantially higher prices. TSP, officially priced at Tk1,350 per sack, has reportedly been selling for around Tk2,000 in the open market.

More than 100 farmers from Baneshwar and surrounding areas blocked the Rajshahi-Natore highway for about an hour earlier this week, protesting what they described as an artificial shortage and demanding increased supplies.

Enough fertiliser nationally

Government figures, however, continue to show sufficient supply at the national level.

The government told parliament this week that projected demand for urea, TSP, DAP and MOP from October through February stands at 35.87 lakh tonnes, against 51.71 lakh tonnes of prepared supply – around 15.84 lakh tonnes above projected demand.

State Minister for Commerce Md Shariful Islam said the government was maintaining domestic production, imports and buffer stocks to keep supplies uninterrupted.

The figures reinforce the central problem identified by officials and sector insiders: fertiliser is available nationally, but disruptions in the dealer network are preventing it from consistently reaching farmers.

Govt steps up monitoring

The government has intensified enforcement as it tries to stabilise distribution.

Agriculture ministry officials said 230 mobile courts were conducted between 28 August and 10 September, with fines totalling Tk38,68,824. Authorities also recovered 1,700 sacks of fertiliser and sentenced four people to imprisonment.

Monitoring arrangements have been strengthened across all 64 districts, while the government is moving ahead with new dealer appointments.

The challenge now is to complete that transition without further disrupting a distribution system already under pressure during one of the busiest periods of the agricultural calendar.

The government aims to attract an additional $5 billion in US investment to Bangladesh over the next five years, Commerce Minister Khandakar Abdul Muktadir said.

He said the government and the American Chamber of Commerce in Bangladesh (AmCham) would work together to achieve the target, with the government ready to cooperate with US companies to boost investment, create jobs, facilitate technology transfer and expand economic opportunities.

The minister made the remarks as the chief guest at a programme marking AmCham Bangladesh's 30th anniversary at the Radisson Blu Water Garden in Dhaka today (12 September).

US Ambassador to Bangladesh Brent T Christensen, AmCham President Syed Mohammad Kamal, Vice President Ala Uddin Azad, former presidents and current and former executive committee members, government officials, business leaders and media representatives attended the event.

Bilateral trade between Bangladesh and the US currently exceeds $13 billion, Muktadir said, adding that the relationship extends well beyond trade.

AmCham member companies have invested more than $5 billion in Bangladesh and contribute more than 20% to the country's national revenue, according to the minister.

"This investment reflects the confidence of US businesses in Bangladesh's economy," he said.

Muktadir said AmCham leaders recently met with the prime minister and expressed interest in bringing an additional $5 billion in US investment to Bangladesh over the next five years.

"The government will provide the necessary support to implement this initiative," he said.

He assured US businesses that the government would respond to genuine concerns raised by investors.

Money is getting cheaper in Bangladesh, but the falling cost of credit reflects a sluggish economy rather than a recovery.

Interest rates have steadily declined as banks accumulate vast excess liquidity amid weak credit demand. Simultaneously, Bangladesh Bank has shifted towards an easier monetary stance by cutting its benchmark policy rate, placing further downward pressure on money-market yields.

Healthy commercial banks have trimmed both lending and deposit rates by 1-2 percentage points in recent months. This comes as private-sector credit growth dropped to 4.47% in June – the lowest level in 33 years. Average deposit rates at most institutions now hover between 7% and 8%, while lending rates range from 10% to 11%. With minimal credit demand from businesses, banks have piled into government securities, driving yields on all Treasury bills and bonds down into single digits.

By June 2026, total excess liquidity in the banking sector surged by 39.40% year-on-year to exceed Tk4 lakh crore. The foreign-exchange market shows a similar imbalance: robust dollar inflows and weak import demand have created upward pressure on the taka. To prevent sharp currency appreciation and protect exporters and remitters, the central bank resumed dollar purchases from commercial banks on 1 September, buying $50 million at Tk122.75 – well above market remittance rates of Tk122.30-122.60. Gross foreign-exchange reserves subsequently rose by nearly $5 billion over the year, reaching $36.33 billion by 3 September.

This rate decline occurs against a fragile macroeconomic backdrop marked by sluggish growth, persistent inflation, and high unemployment, raising fears of stagflation. Although inflation eased to 8.26% in August, it remains comfortably above the government's 7.5% target for FY27. Because prices were already elevated last year, this ongoing inflation compounds a high baseline, keeping consumer prices uncomfortably high.

In response, Bangladesh Bank is injecting liquidity via stimulus measures and planning further monetary easing to reignite investment. However, economists and bankers warn that injecting liquidity without addressing structural bottlenecks will fail to revive real demand and could aggravate inflation.

Why is Bangladesh Bank cutting rates?
In July, Bangladesh Bank lowered its policy rate by 50 basis points to 9.5% to spur private investment. This marked a clear departure from the tight monetary stance maintained since 2022, during which the policy rate was gradually raised from 5% to 10% and kept there for nearly two years from October 2024.

"Our earlier assumption was that raising the policy rate would make money expensive, reduce liquidity, and curb inflation," a senior Bangladesh Bank executive said on condition of anonymity. "However, that mechanism failed in our context. Despite keeping the rate high for two years, inflation remained stubborn."

The official added that elevated interest rates instead drove up corporate financing and production costs, which firms passed directly to consumers. "We are now testing a supply-side strategy: lower the policy rate to reduce production and import costs. If supply expands and unit costs fall, prices should moderate."

Easier money risks fueling inflation
Md Ezazul Islam, Director General of the Bangladesh Institute of Bank Management, argues that lower interest rates are a symptom of economic paralysis. "Economic activity remains constrained by gas and electricity shortages, the lingering aftershocks of recent political instability, and global uncertainty," Islam noted.

While deposit growth has remained steady, banks cannot generate matching credit due to absent loan demand. "Banks naturally redirect excess funds into government Treasury bills and bonds. With heavy government borrowing and intense competition among banks for these safe assets, yields drop. That is basic market dynamics," Islam said, adding that the trend will persist until private credit demand rebounds.

Islam cautioned that monetary easing without productive capacity risks worsening inflation. "Job creation and investment are primarily fiscal responsibilities. If the government wants to stimulate the economy, it must deploy fiscal tools through the budget – such as tax relief, infrastructure spending, and securing energy supplies – rather than over-relying on central bank liquidity."

Structural hurdles mute credit demand
Despite lower borrowing costs, credit demand shows no sign of recovery. City Bank, one of the country's prominent private lenders, recorded just 7%-8% credit growth over the first nine months of the year – half its historical average – despite double-digit deposit growth.

A senior executive at the bank noted that expected credit demand failed to materialise even after post-election political uncertainty subsided. "Even when we offer competitive rates to large corporate clients, many refuse to borrow due to persistent gas shortages," the executive said. Consequently, City Bank redirected surplus liquidity into government debt and deployed over Tk 2,000 crore into the central bank's stimulus fund.

The executive also cast doubt on the official 4.47% private-sector credit growth figure for June. "Real growth is likely negative; much of that figure reflects forced loans and accrued interest on existing facilities."

He noted that the central bank's Tk60,000 crore stimulus package equals roughly 3% of total bank loans. Fully implementing it would only push credit growth to 7%-8% – far below the 15%-16% required to support the government's 6.5% GDP growth target for FY27. "Furthermore, banks will not take the risk of lending to distressed or insolvent businesses simply because money is cheap," he added.

Certainty over cheap money
Tareq Refat Ullah Khan, managing director of BRAC Bank, emphasised that falling rates stem directly from surplus liquidity rather than intentional economic stimulus. "When credit growth halts, money builds up. Lowering rates alone cannot create demand if the wider business environment remains unsupportive."

BRAC Bank has lowered corporate lending rates to 11%-12% (with select prime clients receiving 9%-10%), while SME rates have dropped to 14%-15% and retail rates to 11%-12%. Deposit rates across sound banks have settled around 8%-9%. Distressed banks continue offering 11%-12% on deposits solely to maintain liquidity, rather than to finance new lending.

Abul Kashem Md Shirin, former managing director of Dutch-Bangla Bank, observed that major industrial borrowers are holding back expansion plans due to broader uncertainty. "When liquidity is abundant and credit demand falls, rates drop naturally. Bangladesh Bank spent years trying to force interest rates down through directives, but market forces are finally driving the adjustment automatically – which is precisely how a market economy ought to function."

US consumer prices have accelerated in August, while a key measure of underlying inflation posted its largest increase in four months, reinforcing expectations that the Federal Reserve will raise interest rates next week.

The Labor Department's Consumer Price Index report on Friday followed strong readings in several components of the Producer Price Index released on Thursday that feed into the Personal Consumption Expenditures price indexes, the inflation measures the US central bank tracks for its 2 percent target. The two reports led economists to think that PCE inflation excluding the volatile food and energy categories picked up in August.

Financial markets initially priced in a 91 percent chance of a quarter-point rate hike at the Fed's meeting on Tuesday and Wednesday, before settling back to 87 percent, CME's FedWatch tool showed. That was up from 72 percent on Thursday. The Fed's benchmark overnight interest rate is currently in a 3.50-3.75 percent range.

Most economists said the firmer inflation readings, combined with signs of the labour market regaining its footing in August, would compel Fed officials to raise borrowing costs not only next Wednesday, but possibly again in October or December.

They argued that with the Iran war continuing, the energy shock would spread through the economy. They also expected an AI buildout to drive inflation. Crude oil prices climbed back above $100 a barrel this week, while the US national average diesel price surpassed $6 a gallon for the first time.

"Energy inflation does not stay at the gas station. It travels by truck, aeroplane and cargo ship into nearly every store in America," said Sung Won Sohn, a finance and economics professor at Loyola Marymount University. "The Fed is now more likely than not to raise its policy rate ... it cannot afford to let an energy shock become an everything shock".

The CPI increased 0.4 percent last month after edging up 0.1 percent in July, the Labor Department's Bureau of Labor Statistics said. In the 12 months through August, consumer inflation advanced 3.4 percent after rising by the same margin in July. The rise in the CPI was in line with economists' expectations.

A 3.9 percent jump in petrol prices after two straight monthly declines accounted for more than a third of the increase in the CPI over the month. Other motor fuels, which include diesel, surged 9.6 percent. They surged 44 percent year-on-year in August.

There was, however, some respite for consumers at the supermarket. Food prices edged up 0.1 percent for a second straight month. Grocery prices were unchanged amid muted increases in the costs of meat and fish. Fruit and vegetable prices fell 0.4 percent over the month, weighed down by a 6.2 percent drop in the cost of lettuce because of a Cyclospora outbreak.

But egg prices increased 2.9 percent, while non-alcoholic beverages cost more, as did dairy and related products. Food prices advanced 2.7 percent year-on-year in August and the annual increase in consumer inflation is outpacing wage growth. Inflation-adjusted average hourly earnings fell 0.3 percent over the year in August.

"Inflation-adjusted wage growth contracted for a fifth consecutive month in August," said Gregory Daco, chief economist at EY-Parthenon. "This is the longest income squeeze since 2012, excluding the post-pandemic period when public assistance kept income growing despite historical job losses."

Frustration over rising cost of living

Frustration over the higher cost of living has led to a sharp erosion in President Donald Trump's approval ratings and could cost his Republican Party control of the US Congress in the November midterm elections, according to analysts.

The growing disenchantment was also evident in the University of Michigan's Surveys of Consumers, which showed its Consumer Sentiment Index tumbled to 47.8 in early September from 51.7 in August. The deterioration in sentiment was among both Democrats and Republicans. Consumers also anticipated higher inflation over the next 12 months and five years.

Wall Street stocks rose as oil prices retreated, though crude remained on course for a weekly gain of more than 8 percent. The dollar was steady against a basket of currencies. US Treasury yields initially rose, with the benchmark US 10-year note yield rising to 4.9915 percent before easing back to 4.92 percent.

Excluding food and energy, the CPI rose 0.3 percent last month, the largest increase since April. That was above economists' expectations for a second straight month of a 0.2 percent gain. Core CPI increased 2.4 percent year-on-year in August after rising 2.5 percent in July. Core CPI inflation was lifted by a 5.9 percent jump in mobile phone costs, likely related to service changes at AT&T.

Airline fares increased 2.7 percent, reflecting higher jet fuel costs. The cost of education and communication services rose solidly, while rents rose 0.2 percent and prices for hotel and motel rooms rebounded 2.4 percent. But healthcare costs eased and motor vehicle insurance fell 0.8 percent.

Core goods inflation was benign, suggesting the pass-through from import tariffs was fading, though an escalation in trade tensions between the United States and Canada posed an upside risk. There were rises in the prices of new motor vehicles as well as used cars and trucks. Prices for prescription medication were unchanged.

With the CPI and PPI data in hand, most economists expected core PCE inflation to increase 0.3 percent after gaining 0.2 percent in July. Estimates for the year-on-year increase in core PCE inflation converged around 3.4 percent. Core PCE inflation advanced 3.3 percent in the 12 months through July. The August PCE inflation report will include changes to the methodology.

Fed Chairman Kevin Warsh said last month the central bank will "have work to do" if policymakers don't get the confidence they need that inflation is heading down to 2 percent. But Trump is pressuring the Fed to cut rates, posting on social media last week, "Lower the rate or I'll stop trading with countries with which we have a deficit".

Economists have blamed what they called political intimidation for the surge in yields on long-term US government bonds.

"The markets are doing the Fed's job for it by pricing the yield curve significantly higher, and the Federal Open Market Committee is now behind the curve," said Brian Bethune, an economics professor at Boston College. "At this point, Warsh and the FOMC have painted themselves into a corner".

US consumer inflation was unchanged at 3.4 percent in August, government data showed Friday, with persistent high prices raising expectations that the Federal Reserve will hike interest rates in the world’s largest economy next week.

Consumer price index (CPI) inflation remains significantly elevated from earlier in the year and well above the Fed’s long-term two-percent target.

US households have been battered by years of high prices since the pandemic -- when consumer inflation hit 9.1 percent -- and Americans’ ability to afford basics like food and fuel will be a key issue in November’s midterm elections.

Several Fed policymakers have indicated they would be prepared to raise interest rates if August inflation data did not show a slowdown in price increases. The central bank’s rate-setting committee meets next week.

Any move to raise rates will be sure to anger US President Donald Trump, who has launched an unprecedented campaign against the Fed’s independence, demanding policymakers lower interest rates to spur economic activity.

The US president launched a criminal probe against previous Fed chair Jerome Powell, is attempting to fire another Fed governor and last week even threatened to cut trade ties with certain countries if the Fed raised rates.

Trump is under pressure over the high cost of living, with Democrats seeking to wrest control of both houses of Congress in November and block the Republican’s agenda in the final two years of his term.

Fuel price increases accounted for one-third of the monthly rise in consumer prices, Friday’s data showed.

The price of gasoline in the US is up 44 percent since the start of the Iran war in February, according to AAA motor club data.

Record diesel prices -- which hit an unprecedented $6 per gallon in the United States on Friday -- have also driven up transportation, farming and construction costs.

The index for inflation excluding volatile fuel and food prices -- so-called “core” inflation -- rose 2.4 percent in August year-on-year.

“The renewed march higher in oil, gasoline and diesel prices add to concerns that higher energy prices could spill over to other goods and services and inflation expectations,” said Kathy Bostjancic, chief economist at Nationwide, in a note.

Market expectations of a rate hike surged in the wake of the inflation reading, with the probability of a 25-basis-point hike at 87 percent, according to CME’s FedWatch tool.

INFLATING HITTING HARD

High prices have been hitting the US economy hard, with wholesale inflation picking up more than expected in August, according to government data on Thursday.

The Fed last raised rates three years ago, capping a hiking cycle it began in the pandemic to combat surging prices.

Inflation has declined steadily from its 2022 peak, but never hit the Fed’s two-percent target. In February it fell to 2.4 percent but subsequently surged to three-year highs on the back of Trump’s war on Iran.

The United States and Israel launched strikes on Iran and killed its leadership at the start of the war, plunging the Middle East into chaos as Tehran targeted US regional allies and choked off a key energy trade route.

The Fed has gradually lowered rates since 2024 but has held them steady between 3.50 percent and 3.75 percent this year as inflation climbed following the Middle East war and as the effects of Trump’s tariff war filtered through the economy.

Democratic Senator Elizabeth Warren slammed Trump over the latest inflation figures.

“Today’s data confirms that Americans continued to pay more for housing, airline fare, and childcare in the month of August, while their wages have failed to keep up with inflation for five consecutive months,” she said.

Many US households have been struggling in recent years, and on Friday a gauge of consumer sentiment by the University of Michigan was near an all-time low.

“With a resurgence in fuel prices and trade tensions, consumers anticipate greater pressures on their pocketbooks to come,” said survey director Joanne Hsu.

Some 110,364 registered farmers across Bangladesh will receive Tk2,500 each under the pilot phase of the government's Farmer Card programme, Agriculture Minister Mohammad Amin Ur Rashid said today (12 September).

The government plans to eventually bring more than 20 million farmers under the programme within the stipulated timeframe, he said.

The minister disclosed the plan during a press briefing in Fulgazi upazila of Feni, where he inspected preparations for Prime Minister Tarique Rahman's visit and the inauguration of the Farmer Card, Family Card and monthly honorarium allowances for imams, muezzins, khadems, priests and sebayets.

The inauguration programme is scheduled for 17 September, with preparations underway, the minister said.

"On the opening day of the pilot programme, 110,364 registered farmers across the country will receive Tk2,500 each as an incentive. A total of 7,643 farmers in Feni district will receive the card," he said.

The programme will be gradually expanded to every upazila, union and block across the country, he added.

The minister said farmers would be selected without discrimination and that the programme would cover all categories of genuine farmers.

"All genuine farmers - marginal, small, landless, medium and large - will be brought under the programme," he said.

The initiative aims to ensure farmers can obtain fertiliser and seeds at fair prices while receiving fair returns for their agricultural produce.

Government assistance will also be delivered to genuine farmers in a more organised and transparent manner through the Farmer Card, Amin Ur Rashid said.

Responding to questions about fertiliser shortages, the minister said there was no shortage in the country and warned against attempts to create an artificial crisis.

"Anyone attempting to create an artificial shortage, harass farmers or sell fertiliser at inflated prices will face strict action. The government has a zero-tolerance policy towards irregularities and corruption involving fertiliser," he said.

He said authorities had received reports that fertiliser was being stored outside authorised dealers' premises.

"If fertiliser that is supposed to be with a dealer is found in another warehouse or with an individual, the matter is being investigated," he said.

The Ministry of Agriculture has formed several teams to monitor the situation, he added. The teams are working from 8am to 10pm and will take prompt action when they receive information about fertiliser-related irregularities.

The government is also prioritising agricultural modernisation and increased production in char areas, the minister said.

Plans are being formulated to assess how different chars across the country can be modernised and how agricultural output in those areas can be increased, he added.

The Dhaka bourse closed the week's last session in the red, extending its losing streak to three consecutive sessions.Geographic Reference

Apart from a correction in the broad index, turnover value remained insignificant as investors stayed hesitant about fresh participation amid intensifying macroeconomic tensions and the lowest credit growth of 4.47 per cent.

The market opened the day's session positively, but the DSEX, the broad index of the Dhaka Stock Exchange (DSE), soon lost its momentum.

The DSEX eventually closed at 5,515 points, down 22 points from the previous session, while turnover value rose 4.75 per cent to Tk 5.44 billion.

The broad index lost 52 points over the last three sessions.

Insiders said both the newly emerging macroeconomic tensions and issues linked to regulatory inspections had made investors worried about the future direction of the capital market.

There are fears of a further rise in inflation following a fresh surge in oil prices in the global market. International oil prices crossed $100 per barrel this week.

Consumers will have to bear the adjusted prices of products following the rise in oil prices. For example, the association of the country's bakery owners has already decided to adjust the prices of bakery products from Saturday.

As a result, fresh worries over rising expenditure on basic needs weighed on investors.

All sectors of listed companies, except mutual funds, declined marginally on the premier bourse on Thursday.

Grameenphone, British American Tobacco Bangladesh and Square Pharmaceuticals were among the top index draggers.

As the majority of blue-chip stocks declined, the DS30 index lost 7.71 points to close at 2,095 points.

Meanwhile, investors are awaiting disclosures of quarterly statements for July-September with bated breath.

Manufacturers, who have been enduring a steep energy crisis and may have cut production as a result, are likely to report compromised bottom-line growth.

According to insiders, some regulatory measures, such as the exchange's move toward more frequent inspections of brokerage firms, have also played a role in reducing speculative transactions.

Mutual funds dominated the list of top 10 gainers on Thursday. All funds saw appreciation as investors took positions ahead of liquidation to realise profits based on NAV (net asset value).

CAPM BDBL Mutual Fund 01 was the top gainer, rising 9.72 per cent, while Reliance Insurance was the worst performer, declining 3.96 per cent on the DSE.

The momentum behind the Comprehensive Economic Partnership Agreement (CEPA) should be turned into tangible joint-venture manufacturing and foreign investment, said South Korean Ambassador to Bangladesh Kim Ji-joon.

He stressed the need to ensure a level playing field for formal investors and introduce a more investment-friendly tariff structure to attract greater Korean investment.

Kim made the remarks as the chief guest at a seminar titled “Navigating the National Budget 2026-2027: Opportunities for Business and Investors” at Sheraton Dhaka in Banani on September 9.

The Korea-Bangladesh Chamber of Commerce & Industry (KBCCI) organised the seminar, according to a press release.

The ambassador also called for integrated industrial clusters, predictable incentives for joint ventures, and simpler visa and work-permit procedures for foreign experts.

He urged stronger digital links among customs, ports, banks and tax authorities, along with effective investor aftercare and reliable energy supplies.

Kim reaffirmed Korea’s commitment to being a long-term partner of Bangladesh in investment, technology transfer and manufacturing know-how.

Welcoming the participants, Shahab Uddin Khan, president of KBCCI, said changes in tax, value-added tax (VAT), customs duties and import policies directly affect business costs, investment decisions and future planning.

He reaffirmed KBCCI’s commitment to strengthening Bangladesh-Korea economic ties through greater trade and investment, joint ventures, technology transfer and industrial cooperation.

Snehashish Barua, a chartered accountant and a director of SMAC Advisory Services Ltd, delivered a keynote titled “Finance Act 2026 Unveiled: Analysis of Key Tax, VAT, Customs & Regulatory Changes”.

He provided a practical analysis of major fiscal and regulatory changes and their implications for businesses and investors.

Md Moazzem Hossain, member of the National Board of Revenue (NBR), and Nahian Rahman Rochi, executive member of Invest Bangladesh, attended the event as special guests.

The seminar provided a platform for dialogue between policymakers and the private sector and explored new opportunities for businesses and investors. It also highlighted KBCCI’s role in strengthening the longstanding economic ties between Bangladesh and South Korea.

Do-Kee Park (Harry), chief executive officer of KBCCI, was also present, among others.

The government has stepped up its oversight of public financial management, issuing a strict directive to all government ministries, divisions, and institutions to revise and update their budget-implementation plans (BIPs), according to the finance ministry.

Under the initiative, the finance ministry has asked various state agencies, including ministries, divisions, and other government entities, to urgently revise their BIPs to align public spending with the government's election manifesto, reform agenda, and priority programmes for the fiscal year 2026-27.

"The ministry also sent the instruction to the cabinet secretary, comptroller and auditor general, chief election commissioner, and secretaries of more than 20 ministries and divisions, including home, planning, finance, economic relations, railways, disaster management, foreign affairs, education, and youth and sports," an official involved in the matter said.

The Finance Division has set September 15 as the deadline for completing the exercise and updating the plans in the iBAS++ BIP module, according to a directive issued on September 7.

The directive comes as the government moves to strengthen monitoring of budget execution and ensure that spending plans are consistent with its newly set policy priorities.

The Finance Division said the FY27 budget was prepared considering the government's election manifesto, reform programmes, and priority areas. It also noted that ministries and divisions had already prepared their annual procurement plans (APPs) in line with the government's priority programmes.

They have, therefore, been instructed to review their existing BIPs and make necessary changes so that the budget implementation plans are consistent with the APPs and government priorities.

The instruction was issued under Section 15 of the Government Financial and Budget Management Act 2009, which provides for regular monitoring of progress in budget implementation.

The Finance Division said the methodology and necessary forms for preparing BIPs were incorporated into Budget Circular-1 issued on April 20 this year. The BIP module has also been developed in the iBAS++ system for ministries, divisions, and other government institutions.

The latest instruction effectively seeks to bring budget execution, procurement, and government priorities under a common implementation framework, allowing the Finance Division to monitor whether spending is progressing according to approved plans.

The ministries and divisions have been asked to complete the revised BIPs and inform the Finance Division by September 15.

The government formulated a Tk 9.38 trillion national budget for FY27, with Tk 3.0 trillion earmarked for the annual development programme (ADP).

When contacted, a senior official of the finance ministry said the move signalled the government's bid to enforce greater financial discipline and closer oversight of budget execution, particularly by linking procurement plans with the policy priorities reflected in the FY27 budget.

A unit of the 1,600-megawatt Adani power plant in India's Jharkhand has shut down following "technical fault" that further tightened Bangladesh's power-supply situation amid ongoing gas, coal and liquid-fuel shortages.

Sources say the shutdown has cut down the plant's generation by more than half.

The plant was generating more than 1,400 megawatts on Thursday night before one of its units went offline around midnight.

By Friday noon, its generation had fallen to 736mw, according to sources at Bangladesh Power Development Board (BPDB) and Power Grid Company of Bangladesh (PGCB).

At 3:00am on Thursday, grid supply came down to 12,907 megawatts against 15,776 MWs in demand, leaving a 2,869mw shortfall.

Officials familiar with the plant said a technical glitch had developed in the boiler of one of its units. "The boiler may take around 48 hours to cool before repair can begin, meaning it could take several days for generation to return to normal."

The BPDB signed a power-purchase agreement with the plant authority in 2017. The plant has supplied more than 1,500 megawatts at times, based on Bangladesh's demand.

Meanwhile, the country's power generation has come under increasing pressure for worsening energy shortage and technical glitches at some power plants.

According to BPDB sources, the gas shortage has persisted for more than two months, reducing generation from gas-fired power plants by up to 1,500 MWs. Several coal-fired plants are also operating below capacity due to fuel shortages and technical problems.

Latest generation data show that BPDB generates 13,000-14,000 MWs against peak-hour demand exceeding 16,000 MWs, leaving a significant supply deficit. Current production relies primarily on gas-fired plants (5,000 MWs), coal-fired units (4,500 MWs), and liquid-fuel plants (2,000-3,000 MWs).

Generation at the Payra power plant in Patuakhali has also been affected, with one unit remaining offline for several days due to coal shortages and a technical fault. Another power plant in Patuakhali is also facing a coal shortage.

Sources said authorities were trying to offset the shortfall by increasing generation from oil-fired power plants to make do with.

However, the additional generation has not been sufficient to fully ease the pressure on the power-supply system.

Load shedding has also increased as electricity demand rises with higher temperatures even at the fag-end of the outgoing summer.

Despite Friday being a weekly holiday, load shedding exceeded 2,500 MWs in the morning. It later fell to 414 MWs at about 2:00pm as generation increased.

The shutdown of one of Adani's units, along with fuel shortages and technical glitches at other plants, is likely to put additional pressure on the country's power- supply system over the coming days.

Bangladesh received $6.85 billion in remittances from July 1 to September 9 of fiscal year 2026-27, up 15.9 percent year-on-year, according to Bangladesh Bank data released Thursday.

The country received $5.918 billion during the same period of FY26.

Bangladeshi expatriates living in different countries sent home $1.031 billion in remittances in the first nine days of September 2026, up 1.3 percent from $1.018 billion during the corresponding period a year earlier, the central bank data showed.

On September 9 alone, the country received $127 million in remittances.

Bangladesh received $35.34 billion in remittances through formal banking channels in FY26.

The government will import 18 cargoes of liquefied natural gas (LNG) from France-based energy company TotalEnergies over the next nine months, with two cargoes scheduled each month from October this year to June next year.

The government may also purchase additional LNG cargoes from the company if needed, subject to mutual agreement between the two sides.

The Cabinet Committee on Government Purchase approved the LNG procurement proposal at a meeting chaired by Finance Minister Amir Khosru Mahmud Chowdhury today (9 September).

The LNG will be procured through the direct purchase method for international procurement.

Each LNG cargo from TotalEnergies will be priced at the Japan Korea Marker (JKM) plus $0.06 per million British thermal units (MMBtu), according to the government.

The rate is slightly lower than the price agreed with US-based Gunvor for 14 LNG cargoes to be imported between 2026 and 2028. Under that arrangement, the price was set at JKM plus $0.0875 per MMBtu.

The TotalEnergies procurement received policy approval from the Cabinet Committee on Economic Affairs to meet urgent gas demand amid heightened geopolitical instability stemming from the conflict in the Middle East, according to the Ministry of Finance's Public Relations Department.

Bangladesh has long-term LNG supply agreements with Qatar and Oman. However, supplies under the contracts have been disrupted amid the Iran conflict, contributing to the country's ongoing gas shortage.

Against this backdrop, the government has been buying LNG from the spot market at relatively high prices while seeking alternative sources to bolster supplies.

As part of that effort, the government has also approved a proposal to sign a long-term LNG import agreement with US-based Gunvor through 2038.

Under the approved arrangement, Bangladesh will import 14 LNG cargoes from Gunvor between 2026 and 2028 at JKM plus $0.0875 per MMBtu.

The United States banned a broad swath of Canadian alcoholic beverages, motorcycles and dairy products from import on Tuesday, sharply escalating an already acrimonious trade spat.

The import bans, which go into effect on September 29 and were published on the White House’s website, came after Canada’s own retaliatory tariffs on US goods took effect after midnight on Tuesday.
Those Canadian levies themselves followed 50 percent tariffs that the United States imposed on some $20 billion of Canadian goods last month, after several rounds of negotiations collapsed.The breakdown has widened a rift between the longtime allies, who have blamed each other for the failed talks, spurred Canadian Prime Minister Mark Carney to urge a further shift away from Canada’s biggest trading partner, and cast doubt on the viability of the US-Mexico-Canada Agreement.“We have everything we need to pivot and prosper,” Carney said on Tuesday in a video posted on YouTube. “That pivot will come at a cost. There’s always a cost to action. But it doesn’t come close to the cost of standing still,” he said.

The import bans came after Canada’s own retaliatory tariffs on US goods took effect after midnight on Tuesday

The US bans appeared to cover most alcohol products, including beer and various types of wine, whisky, bourbon, rum, vodka, vermouth, tequila, mezcal, and brandy. The dairy ban covers whey protein, invert molasses, cane molasses and non-alcoholic beer, per notices on the White House’s website. In addition to the import bans, various cheese products were added to a list of products subject to a 50 percent tariff, but not banned outright.

Some paper, aluminum, wood, furniture, lighting and other products were also added to the list.

A US official said President Donald Trump’s pre-existing threat to increase tariffs on Canadian autos from 25 percent to 50 percent on January 1 remained in effect.

The official added that US Trade Representative Jamieson Greer had spoken with Dominic LeBlanc, Canada’s minister responsible for bilateral US trade, over the past couple of days, and the pair were expected to speak again in the coming days to see if there was an alternative path for the two countries.

In a social media post on Tuesday night, LeBlanc criticized the latest US measures and said he was in contact with Greer regarding a path forward.

“As has been the case for the last 18 months, our first priority remains on protecting and supporting Canadian workers, farmers, families, and businesses from these unjustified actions,” he wrote.

OTTAWA STRIKES BACK

Ottawa’s retaliatory measures, which in turn provoked Washington’s move on Tuesday night, were designed to put economic and political pressure on Washington, Canadian government officials said.

Those counter-tariffs cover some $20 billion of US goods, with duties ranging from 15 percent to 50 percent across products from steel and furniture to clothing and electronics, and are expected to hit sectors in some competitive states such as Michigan and Ohio, ahead of US midterm elections in November.

While the tariffs affect a small amount of exports compared with total trade between the US and Canada, some analysts worry the standoff could destabilize the US-Mexico-Canada Agreement, the free-trade pact that succeeded NAFTA.

Together they have underpinned commerce across North America for decades.

“What we are worried about is an escalatory spiral,” said Michael Harvey, executive director of the Canadian Agri-Food Trade Alliance and a member of Carney’s advisory committee on bilateral US economic relations.

“But at the same time, we totally understand that the prime minister needs to find areas of leverage.”

Trump has been lobbing various attacks at Canada on Truth Social in recent days.
Google News LinkFor all latest news, follow The Daily Star's Google News channel.

On Monday, he said Canadian private jet maker Bombardier would no longer be allowed to sell its planes in the United States unless it started manufacturing in the country.

He also shared a map of North America draped in the US flag, including Canada and Mexico, and an AI-generated image reviving a running jab at Carney, calling him “Governor,” a reference to his repeated taunt that Canada should become the 51st US state.

On Tuesday, hours before the latest import bans, Trump directed the General Services Administration, a US government body responsible for providing services for the federal government, to coordinate with the US Trade Representative and “REMOVE Canadian-origin products from GSA’s Multiple Award Schedules unless Canada restores full and fair reciprocity for American Farmers and Companies.”

VARIOUS SECTORS HIT

Trump’s tariffs implemented last month hit sectors including wine, furniture, dairy products, cement, clothing, fishing rods and hockey equipment, covering $20 billion, or 5 percent, of Canadian exports to the US.

A Sapporo spokesperson said the brewer is considering moving a limited amount of production of non-alcoholic drinks from Canada to the US due to tariff risks, but no final decision has been made.

Sapporo owns Ontario-based Sleeman Breweries.

Canada accounts for more than half of the Japanese firm’s overseas beer sales.

According to Canadian and US government data, Canada has shipped almost 68 percent of total exports to the US this year, out of which roughly 80 percent moved duty-free due to exemptions under the USMCA pact.

Protections under the agreement have provided the domestic economy some resilience.

Last month’s tariffs, imposed under a Depression-era US law, do not allow Ottawa to exercise USMCA exemptions.

Concerns about the USMCA’s future have fueled uncertainty about investment and growth, as Canada wages a trade war against an economy 13 times its size.

Polls also show Carney has broad support from Canadians, but that could disappear within months as the consequences of the trade war sink in, according to political analysts.

A new poll from Angus Reid on Tuesday showed that approval of Carney’s performance jumped 11 points to 62 percent from an August poll.

Meanwhile, just 20 percent of Americans approved of Trump’s tariffs on Canadian goods, a Reuters/Ipsos poll found.

Trump threatened last month to raise US tariffs on all cars, trucks and automotive parts from Canada to 50 percent starting January 1, and signed an executive order renaming Lake Ontario as Lake America.

Ten banks accounted for more than 72 percent of the banking sector’s total non-performing loans, according to the central bank, showing that the country’s 61 commercial lenders are not equally responsible for the sector’s financial distress.

As of June this year, bad loans in the banking sector stood at a whopping Tk 6,06,555 crore, according to the latest data from the Bangladesh Bank (BB). Of this, the 10 distressed lenders held Tk 4,39,527 crore in NPLs.

The lenders are Islami Bank Bangladesh, Janata Bank, Agrani Bank, IFIC Bank, National Bank, AB Bank, First Security Islami Bank, EXIM Bank, Social Islami Bank and Union Bank.

In terms of volume, Islami Bank Bangladesh has the highest level of bad loans in the banking sector. Until June this year, its NPLs stood at around Tk 98,914 crore, or 52.15 percent of its disbursed loans.

The bank was taken over by S Alam Group in 2017. The controversial conglomerate later extended around 80 percent of the bank’s total loans to its own companies and associated firms, violating banking rules and regulations.

After the fall of the Awami League government in August 2024 in an uprising, the bank was freed from the group’s control and is now operating under the supervision of the BB.

At the end of December last year, Islami Bank’s bad loans stood at Tk 92,115 crore, or 49 percent of its disbursed loans. In the six months to June, its bad loans increased by Tk 6,799 crore, according to BB data.

Contacted, Md Altaf Hossain, acting managing director of Islami Bank, said that a large share of its defaulted loans is linked to the S Alam Group, with recovery remaining minimal.

He said that the bank is trying to recover loans from other borrowers, but progress has been limited.

“We are trying to recover the loans through cash payments and rescheduling. When we find no other way, we ultimately resort to filing cases against the customers,” Altaf told The Daily Star.

The acting managing director said the bank regularised Tk 5,885 crore this year through rescheduling, while it recovered Tk 749 crore from classified loans.

Scam-hit Janata Bank ranked second in terms of bad loan volume. Its NPLs stood at Tk 75,729 crore, or 75 percent of its disbursed loans.

Seeking anonymity, Janata Bank officials told The Daily Star that a major portion of the bank’s bad loans is concentrated among a small number of powerful business groups.

They said that about 80 percent of its bad loans are stuck with its top 20 defaulters, including Beximco, S Alam and AnonTex.

Beximco Group alone accounted for about Tk 25,000 crore of the bank’s exposure. Other major defaulters include Crescent Group and Thermex Group.

Agrani Bank, another state-run lender, also struggles with a heavy NPL burden. Its NPLs stood at Tk 32,133 crore, or 43.98 percent of its disbursed loans, show BB data.

At EXIM Bank, bad loans stood at Tk 38,052.53 crore, nearly 71 percent of its total disbursed loans, according to central bank data.

The bank was largely influenced by Nazrul Islam Mazumder, chairman of Nassa Group and former chairman of the Bangladesh Association of Banks (BAB). Lending irregularities and weak corporate governance have pushed the lender towards a merger with four other troubled banks.

Among lenders linked to the S Alam Group, First Security Islami Bank reported NPLs of Tk 60,645 crore, or 97 percent of its total disbursed loans.

Social Islami Bank’s bad loans stood at Tk 29,799 crore, or 78 percent of its disbursed loans, while Union Bank’s NPLs stood at Tk 27,134 crore, or 96 percent of its disbursed loans.

The boards of the two lenders were also largely dominated by the S Alam Group.

AB Bank’s NPLs stood at Tk 20,325 crore, or 56.04 percent, while National Bank reported Tk 28,276 crore, or 65.46 percent, according to BB data.

Bad loans at IFIC Bank stood at Tk 28,520 crore, or 63.38 percent of its disbursed loans. The bank was dominated by Salman F Rahman, vice-chairman of Beximco Group and an influential adviser to ousted prime minister Sheikh Hasina.

Md Ezazul Islam, director general of the Bangladesh Institute of Bank Management (BIBM), said the country’s NPL situation shows that the problem is concentrated in a handful of Islamic and state-owned banks.

“The main reason for the rise in NPLs is that loans have become concentrated among a small number of corporate borrowers. The banking sector needs to move away from this excessive loan concentration,” he told The Daily Star.

Ezazul, a former official of the central bank, said that around 10 percentage points of the banking sector’s NPL ratio, which has now reached 30 percent, can be attributed to economic factors, while the remaining 20 percentage points are the result of willful default, irregularities and corruption.

The value of internet banking transactions in Bangladesh grew by 6.22 percent month-on-month to Tk 1.84 lakh crore in June 2026, driven mainly by sharp increases in two payment systems, according to a recent central bank report.

The total had stood at Tk 1.73 lakh crore in May 2026.
The transactional values of Real Time Gross Settlement (RTGS) and National Payment Switch Bangladesh (NPSB) rose while Bangladesh Electronic Fund Transfer Network (BEFTN) fell, according to the e-Banking and e-Commerce Statistics review by Bangladesh Bank.RTGS, NPSB and BEFTN are BB-operated interbank payment systems, but they serve different purposes.

BEFTN is for scheduled batch transfers, NPSB is for real-time card and account transactions, and RTGS is for high-value, instant gross settlement-- all three route transactions among the country’s scheduled banks and mobile financial service providers.

Among the individual channels, RTGS transactions rose 26.09 percent to Tk 50,461 crore in June, up from Tk 40,022 crore in May. NPSB transactions increased 2.70 percent to Tk 57,480 crore in June from Tk 55,967 crore in May, the report showed.

BEFTN transfers, by contrast, declined to Tk 11,638 crore in June from Tk 12,987 crore in May. “It is clear that a large number of customers are using internet banking to access financial services,” BB said in the report.

However, the total number of internet banking customers fell slightly during the same period, decreasing 0.64 percent to 2.27 crore in June from 2.28 crore in May.

The data also showed that among the internet banking customer base, 1.78 crore were male, 44 lakh were female, and 4.7 lakh were registered under “other” in June.

As of June, 58 scheduled banks were offering internet banking services in the country.