Bangladesh Purchasing Managers’ Index (PMI) for June recorded a slower expansion rate at 53.1, down 5.8 points from May, reflecting a broad-based deceleration across key economic sectors.

The figures were released on July 7 by the Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka and Policy Exchange Bangladesh (PEB), marking the latest instalment of the pioneering initiative developed with support from the UK Government and technical assistance from the Singapore Institute of Purchasing & Materials Management (SIPMM).

The PMI serves as a timely indicator of economic performance, offering insights to businesses, investors, and policymakers.

The June data reveal that while the overall economy maintained growth momentum for a ninth consecutive month, the rate of expansion has clearly weakened.

Most notably, the construction sector slipped into contraction for the first time in eight months, ending a six-month streak of expansion.

The sector posted negative readings for new business, construction activity, employment and order backlogs, with only input costs showing continued—though slower—expansion.

The agriculture sector extended its run of growth to a ninth month but also saw a slowdown. It recorded a first-time contraction in employment, while indexes for new business, business activity, input costs, and order backlogs showed faster expansion.

Similarly, the manufacturing sector marked its tenth consecutive month of expansion, albeit at a reduced pace.

The sector posted contractions in input purchases, finished goods, imports, and employment. Growth in new orders, exports, factory output, input prices, and supplier deliveries also moderated.

Notably, the order backlog index returned to expansion after ten straight months of contraction.

The services sector continued its expansion for a ninth month but followed the broader trend of slower growth.

It reported contractions in new business, business activity and backlogs, while employment and input costs expanded at a quicker rate.

Future business sentiment was mixed. Manufacturing and construction saw slower expansion in expectations, whereas agriculture and services posted stronger forward-looking indicators.

Commenting on the findings, M Masrur Reaz, Chairman and CEO of Policy Exchange Bangladesh, said, ‘The latest PMI readings indicate the overall Bangladesh economy continued to expand for nine consecutive months. However, the pace of expansion has slowed down in June, and the construction sector recorded a first-time contraction in the last eight months. The long Eid holidays, onset of the monsoon, and anticipated or actual tax changes in the budget have impacted the economic dynamism in June.’