Bangladesh's economy has hit a period of stagnation due to weak revenue collection, a widening budget deficit, and mounting inflationary pressures, according to the Bangladesh Bank’s annual report for FY 2023–24.

The report warns that the economic slowdown is threatening overall macroeconomic stability. Reduced funding for development projects has led to a liquidity crisis in the banking sector, forcing the government to rely heavily on borrowing—further fueling inflation.

However, the report notes some recent signs of recovery following a change in government. Improvements in fiscal discipline, rising domestic savings, and initiatives to boost investment have generated cautious optimism. Inflation is also showing signs of a gradual decline. To ensure long-term stability, the central bank emphasizes the need to increase private sector investment.

World Bank Vice President for South Asia, Martin Raiser, has commended the Government of Bangladesh for its commitment to transparency and accountability. Speaking at the end of his official visit on Wednesday, Raiser noted that bold and urgent reforms could significantly accelerate inclusive economic growth in the country.

The World Bank pledged over $3 billion in the last fiscal year to support Bangladesh’s health, water, sanitation, and social protection sectors. Raiser reaffirmed the World Bank’s continued partnership with Bangladesh, emphasizing support for economic and climate resilience and the creation of job opportunities.

The United States has finalized a trade agreement imposing a 19% tariff on Indonesian exports. Under the deal, Indonesia will purchase $15 billion worth of fuel, $4.5 billion in agricultural products, and 50 Boeing aircraft from the US. President Trump warned that attempts to bypass tariffs via third countries would result in stricter penalties. A similar trade deal with Vietnam is near completion. Analysts note that despite aggressive tariff policies, the Trump administration is lagging behind its goal of finalizing 90 trade deals within 90 days.

The World Bank provided over $3 billion in funding to Bangladesh in the last fiscal year and has committed to maintaining similar support over the next three years. During a meeting in Dhaka with Chief Adviser Professor Muhammad Yunus, Vice President for South Asia Johannes Zutt praised the interim government's financial sector reforms and reaffirmed the Bank’s support for inclusive growth in Bangladesh. Zutt commended Yunus's leadership in youth engagement and women’s empowerment. Yunus emphasized harnessing youth for industrial growth and envisioned Bangladesh as a major economic force.

Increased remittance inflows have boosted the value of the Bangladeshi Taka, causing the exchange rate of the U.S. dollar to fall by Tk 2.20. According to Bangladesh Bank data, the interbank rate stood at Tk 120.10 on Monday, down from Tk 122.30 on July 9. Remittance inflows in FY 2024–25 rose by 26.81%. On July 13, Bangladesh Bank purchased $171 million from the market for the first time, helping stabilize the forex market. Reserves now stand at $24.54 billion, higher than last year. However, bank officials warn that a weakening dollar may harm exporters and overseas workers.

Trade negotiations between the United States and Bangladesh have so far yielded no positive developments regarding the proposed reduction of the 35% additional tariffs on Bangladeshi goods. Discussions are expected to continue throughout July, but policymakers have not issued any clear statements. Representatives from the garment sector warn that if the current 50% total duty remains in effect, it could severely impact exports, with some buyers already suspending orders. Economist Dr. Zahid Hussain criticized the government’s lack of preparation and failure to include relevant experts in the talks.

Following a meeting with Economic Adviser Dr. Salehuddin Ahmed, World Bank Vice President for South Asia, Johannes Zutt, commented positively on Bangladesh’s economic progress. “Contrary to previous concerns, Bangladesh is now on the right track,” he said. Discussions included reforms in the financial sector, foreign exchange, and budget support, with an emphasis on attracting private and foreign investment. The World Bank expressed interest in supporting NBR reforms, bank restructuring, and infrastructure development. Further support will be finalized during the World Bank-IMF annual meetings this October.

Chinese automaker GAC has opened its flagship showroom in Dhaka’s Tejgaon area, expanding its footprint in Bangladesh’s automobile industry. The launch follows GAC’s official brand debut at the Dhaka Motor Show in May. DHS Motors, GAC’s sole distributor, plans to introduce the AION electric vehicle line soon. Senior officials from both DHS Motors and GAC International attended the inauguration. The company also aims to establish a local assembly plant, contributing to the development of an eco-friendly and sustainable transport sector in Bangladesh.

Following U.S. President Donald Trump's announcement of a 30% tariff on imports from the EU and Mexico starting August 1, European Commission President Ursula von der Leyen warned that the EU would take reciprocal measures to protect its interests. While remaining open to negotiations, she stated that the EU would not hesitate to act if necessary. Trump has also proposed increased tariffs on imports from Japan, Canada, Brazil, and other countries.

Donald Trump has announced that a 30% tariff will be imposed on imports from the European Union and Mexico starting August 1.
Although he gave limited praise to Mexico, he accused the country of not doing enough to stop drug trafficking. He labeled the EU's trade practices as a national security threat and declared that one-sided trade relationships would no longer be tolerated.
This move will bring 24 countries, including all 27 EU member states, under the new tariff regime. Trump had earlier announced a similar 35% tariff on imports from countries including Bangladesh.

Garment exporters in Bangladesh have expressed serious concern about the potential suspension of up to $2 billion worth of orders if the Trump administration's proposed 35% tariff comes into effect.
Ongoing trade negotiations between the US and Bangladesh have yielded little progress, prompting brands—including retail giant Walmart—to delay or cancel orders.
Exporters blame the slow pace on disagreements over tariff structures and local value addition. Leaders of BGMEA and BKMEA say the talks are stalling due to undisclosed agreements and a lack of consultation with the business community. They are urging the government to take bold and strategic steps immediately.

Hong Kong’s commercial property sector is under renewed stress as property values continue to drop and office and retail vacancies rise. JLL warns values may fall another 5–10% this year, with developers and banks increasingly strained. Office rents have fallen over 40% since 2019, and retail vacancies are at record highs. The crisis may spread to luxury residential properties as owners seek liquidity. Some developers have already defaulted on large debts, raising concerns over broader financial sector stability.

Tesla is set to open its first showroom in India on July 15, marking a significant step into the country’s growing electric vehicle (EV) market. The “Experience Center” will be located in Mumbai, the financial capital of India. The EV giant signed an agreement in March to establish the showroom. Meanwhile, Tesla is also scouting for a suitable site in New Delhi to expand its presence further in the Indian market. The move signals Tesla’s serious intent to invest in India’s EV future.

Germany is expected to be the hardest hit in Europe by U.S. tariffs, particularly targeting the auto industry. Analysts warn of a 0.4% drop in Germany’s GDP, with ripple effects across Central and Eastern Europe. Ireland also risks major losses if pharmaceutical tariffs are enforced, potentially shrinking its GDP by up to 5%. The EU’s total trade could fall by 8% over five years. Uncertainty may harm investment and jobs, even in countries with limited U.S. exports like France and Spain.

China’s economy grew 5.2% year-on-year in the April–June quarter, supported by strong export performance despite U.S. trade tensions and tariffs. Analysts warn that growth may slow in the second half due to continued external pressure. While exports to the U.S. dropped 43% in May, China increased exports to ASEAN and the EU to offset the loss. Government initiatives to reduce external dependency and boost domestic consumption have helped maintain stability amid a struggling property sector and geopolitical uncertainty.