TBT DESK: Bangladesh’s Purchasing Managers’ Index (PMI) rose by 4.9 points in July from the previous month to 57.8, signalling a faster pace of economic expansion.

The Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka, and Policy Exchange Bangladesh (PEB) released the July Bangladesh PMI report on Sunday.

The report said the improvement was driven mainly by a strong rebound in manufacturing, while construction remained marginally in contraction despite broad-based improvement.

Three of the four key sectors recorded expansion, with manufacturing posting the strongest performance at 65.4, followed by services at 56.0 and agriculture at 55.2.

Agriculture recorded its 11th consecutive month of expansion, although growth moderated by 9.6 points.

New business and business activity remained in expansion, while employment moved into marginal contraction. Input costs continued to rise strongly, while order backlogs remained in contraction, according to an MCCI press release.

The manufacturing sector recorded the strongest turnaround, rising 16.6 points to 65.4 and making the largest positive contribution to the headline PMI.

Expansion was recorded in new orders, new export orders, output, input purchases, imports, employment and supplier deliveries, while input prices also increased. Order backlogs, however, remained in contraction.

The construction sector remained marginally in contraction at 49.3, although it improved by 9.1 points from June. New business, construction activity and employment recorded slower rates of contraction, while input costs and order backlogs continued to expand.

The services sector continued to expand for the 22nd consecutive month, rising 1.4 points to 56.0. New business, employment and input costs recorded faster expansion, while the backlog of orders contracted at a slower pace. Business activity remained in expansion.

The Future Business Index recorded strong expansion across all sectors, reflecting optimism about business conditions in the coming months.

“The July PMI signals broad-based strengthening of Bangladesh’s economy, led by a sharp manufacturing rebound and continued expansion in agriculture and services,” said Dr M Masrur Reaz, chairman and chief executive officer of Policy Exchange Bangladesh.

“The manufacturing recovery coincided with the highest monthly export earnings in 12 months, while construction remained marginally in contraction despite improving conditions,” he said.

Reaz said strong optimism across all sectors pointed to improving business confidence, stronger external-sector prospects, improved foreign exchange conditions and expectations of a more supportive business environment following the FY2026-27 Budget.

The PMI is designed to provide timely insights into the country’s economic health, helping businesses, investors and policymakers make informed decisions.

The index was developed by MCCI and Policy Exchange, with support from the UK Government and technical assistance from the Singapore Institute of Purchasing and Materials Management (SIPMM).