Will food prices never stop rising?

The stubborn and persistent rise in inflation rate is a major threat to the country's short-term economic recovery and long-term developmental goal. According to the Bangladesh Bureau of Statistics (BBS), food inflation rose to 10.22 per cent in April from 9.87 per cent in March. However, a recent survey by the Bangladesh Institute of Development Studies (BIDS) reports an even higher rate of 15 per cent.
BBS data indicates that average inflation in April slightly decreased to 9.74 per cent from 9.81 per cent in March, a modest reduction of 0.07 percentage pounts. Despite this, food inflation rose from 9.87 per cent in March to 10.22 per cent in April. Notably, rural areas experienced higher inflation pressures, with rural inflation at 9.92 per cent compared to 9.46 per cent in urban areas.
For several years, we have observed that the market has been constantly getting out of common people's reach due to the rising prices of daily commodities. This persistent inflation is negatively impacting the standard of living, especially for the poor, as a significant portion of their income is spent on food. Economists have long warned about the dangers of inflation, emphasising the need to increase supply to address the issue.
It is feared that the rising value of the dollar will further drive up the prices of imported goods, exacerbating inflation. Policymakers often attribute the country's inflation to global market impacts due to Bangladesh's import dependency. BIDS highlighted a significant rise in fish prices by over 20 percent in the past year, followed closely by increases in poultry prices, largely due to the import dependency in poultry feed.
While inflation has rapidly decreased in various countries, there are no signs of it abating in Bangladesh. For the past two years, Bangladesh Bank has implemented a contractionary monetary policy, similar to measures taken by other nations, in an effort to curb inflation. However, these efforts have yet to yield any results in reducing inflation.
Controlling inflation requires more than just raising interest rates or implementing isolated measures. It necessitates coordinated efforts such as reducing import duty on essential food items, increasing local production and ensuring an extortion-free supply chain. Addressing these issues with a comprehensive strategy is urgent to rein in inflation.
Faruk Mahmud
Student
Department of English
Dhaka University