Taming inflation to be biggest bet in FY ’24

Bringing down the inflation to a rate projected for the upcoming fiscal year (FY) from the present higher levels would be the biggest challenge, economists said, terming the budgetary estimate ‘not realistic’. The national budget for FY 2023-24, which is set to be placed in parliament today (Thursday), is expected to target a lower inflation rate of 6.0 per cent aiming to facilitate desired economic growth, said an official at the Ministry of Finance. The projected inflation figure is, however, much lower than the last 12-month average of 8.4 per cent to April 2023. The rate is not realistic, rather an ‘aspiration’ of some economic numbers, an economist told the FE on Wednesday. Actually, the government’s efforts are neither working nor being implemented properly to curb inflation, said the economists. Both the point-to-point and 12-month-average inflation rates are on the rise that have already surpassed the levels of more than a decade’s history of the consumer price index (CPI) trend. The point-to-point inflation surged to 9.24 per cent in April 2023 compared to the consecutive month FY2023. In March this year, the BBS recorded inflation at 9.33 per cent which was only 6.22 per cent in March last year, and in April this year, it estimated at 9.24 per cent compared to 6.29 per cent in the same month last year1. According to the BBS, the 12-month average inflation in FY2022 was 6.15 per cent, which was 5.56 per cent in FY2021 and 5.65 per cent in FY2020.

Source: https://today.thefinancialexpress.com.bd/first-page/taming-inflation-to-be-biggest-bet-in-fy-24-1685557877

Tk581cr savings certificates sold in April – highest in FY23

The net sales of savings certificates reached TK581 crore in April – so far the highest in FY23, according to the latest Bangladesh Bank data. The net sales for the first 10 months of the fiscal year, however, stood negative at Tk3,579 crore as the government borrowed some Tk68,000 crore against the repayment of Tk71,600 crore during the period. In the corresponding period of FY22, the net sales of the tools were Tk1,7518 crore. The government set a target of borrowing Tk35,000 crore from savings tools for the ongoing financial year. It has later been reduced to Tk20,000 crore. In this calculation, the government needs a net borrowing of Tk23,579 crore in the next two months – May and June – to meet the target. According to the finance ministry, interest costs for savings tools were initially estimated at Tk42,675 crore for the current fiscal year. It has later been increased to Tk45,100 crore in the revised budget.  Meanwhile, the scope for investment in saving certificates is set to be squeezed further as the government has cut the target of borrowing from the tools by 49% year-on-year to Tk18,000 crore for FY24, according to finance ministry officials.

Source: https://www.tbsnews.net/economy/tk581cr-savings-certificates-sold-april-highest-fy23-641750

Govt to impose specific duty on fuel

The government is going replace existing duty on 13 petroleum products import by a specific duty in the next fiscal year, amounting to a maximum of Tk13.75 per litre, which likely effect from 1 June (Thursday). The specific duty would be Tk 13.75 per litre for 11 types of petroleum products, including kerosene, light diesel, motor spirit and jet fuel. If put into effect, it will have higher impact on retail price than the existing duty rate, which is 10% for 12 petroleum products. The existing duty is 5% on petroleum oils and oils obtained from bituminous minerals, crude, which will be replaced by Tk1117 per barrel (Tk7.02 per litre). Specific duty of Tk9,108 per tonne (Tk9.10 per litre) has been proposed for furnace oil, which is now subject to 10% duty.

Source: https://www.tbsnews.net/economy/budget/govt-impose-specific-duty-fuel-641790