Bangladesh’s headline inflation eased marginally in August, mainly due to a slowdown in food-price growth, but the improvement remained too small to provide meaningful relief to consumers as wage growth continued to lag behind the overall rise in prices.

According to the latest data released by the Bangladesh Bureau of Statistics (BBS) on Monday, point-to-point inflation fell to 8.26 per cent in August from 8.32 per cent in July.

Food inflation declined to 7.02 per cent from 7.16 per cent, while non-food inflation increased slightly to 9.32 per cent from 9.28 per cent.

Commenting on the matter, Former Lead Economist at the World Bank Dhaka Office Zahid Hussain said the marginal decline in inflation should not be interpreted as a fall in prices.

The moderation largely reflects a slight deceleration in the rate at which food prices are increasing, he said, adding that food inflation remains relatively high at above 7 per cent.

“A lower inflation rate does not mean that prices have come down. It means prices are rising at a slightly slower pace,” he said.

He said a relatively stable exchange rate and steady domestic rice supplies, particularly from the Boro harvest, helped prevent sharper increases in food prices.

However, the improvement in inflation has yet to translate into greater purchasing power for households, according to Economist Zahid.

The latest BBS wage data reinforce this concern. The national wage rate index grew 8.05 per cent year-on-year in August, down from 8.22 per cent in July.

The August wage growth was 0.21 percentage point below headline inflation of 8.26 per cent, indicating that wage growth for workers covered by the wage index did not fully keep pace with consumer-price increases.

The BBS wage rate index covers low-paid skilled and unskilled workers across 63 occupations in agriculture, industry and services, rather than all categories of employees.

Zahid said what matters for consumers is not simply whether the inflation rate is falling, but whether household incomes are rising faster than the cost of living.

With nominal wage growth also slowing alongside price growth, households therefore continue to face pressure on their real purchasing power, he noted.

The figures show that while the inflationary pressure has moderated slightly, Bangladesh’s consumers are still confronting a high cost of living, with non-food inflation remaining above 9 per cent and wage growth failing to fully compensate for the increase in consumer prices.