2025: A year of market stagnation and regulatory moves

After the political changeover in August 2024, Bangladesh entered a historic transition under an interim government led by Prof Muhammad Yunus. Expectations were high that the government’s economic reform measures would give a boost to the market. However, those hopes were dashed as the country grappled with macroeconomic challenges alongside intensifying political tension surrounding the national election. Many businesses postponed expansion plans and new investments amid unclear policy signals. Adding to the uncertainty, the central bank kept the policy rate at 10 per cent, while lending rates surged to 15–16 per cent, discouraging borrowing and investment. By the end of the year, some planned reforms materialized. Several influential individuals, once considered untouchable, faced punishment for market manipulation. Meanwhile, the benchmark index of the Dhaka Stock Exchange (DSE) fell 6.7 per cent to 4,865, and the equity market capitalization declined by Tk 360 billion. Global fund manager Asia Frontier Capital (AFC) predicted a market turnaround in 2026, aided by political stability and macroeconomic recovery following the national election scheduled for February 12. Moreover, Bangladesh’s capital market remains attractively valued among regional peers, offering a compelling entry point for investors.