PMI signals modest economic growth in December 2025

FE REPORT
Economic activity expanded marginally in December, according to the latest Purchasing Managers' Index (PMI), which remained firmly in expansionary territory despite mixed sectoral performance.
The modest uptick was driven mainly by continued strength in agriculture, manufacturing and services, even as construction activity weakened.
The PMI rose by 0.2 points from November to 54.2 in December, staying above the 50-point threshold that separates expansion from contraction, data released on Wednesday showed.
The index is jointly developed by the Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka, and Policy Exchange Bangladesh (PEB), with technical assistance from the Singapore Institute of Purchasing and Materials Management.
The marginal improvement in December reflected sustained expansion in agriculture, manufacturing and services, while the construction sector slipped back into contraction.
Agriculture recorded its fourth consecutive month of expansion, and at a faster pace. Stronger growth was observed in new business, overall activity, employment and input costs.
However, order backlogs contracted at an accelerated rate, indicating persistent supply-side pressures.
Manufacturing remained in expansion for the 16th straight month, though at a slightly slower pace than in November.
Firms reported increases in new orders, export demand, factory output, input purchases, imports, employment and supplier delivery times.
The services sector posted its 15th consecutive month of expansion, with a modest acceleration.
Employment and input costs rose, but new business, overall activity and order backlogs remained in contraction, pointing to weak demand conditions.

Despite the headline expansion, business sentiment stayed cautious. Survey respondents cited political uncertainty, seasonal demand slowdown, rising production costs, price volatility and weak sales as major concerns, although many expect conditions to improve gradually from early next year.
As a forward-looking indicator, the PMI showed slower expansion in future business expectations across agriculture, manufacturing, construction and services.
"The latest PMI readings indicate a marginal expansion of the economy, driven mainly by the strong performance of the agricultural sector," said Dr M Masrur Reaz, chairman and chief executive of Policy Exchange Bangladesh.
"Manufacturing has experienced a second consecutive month of slowdown, while construction has reverted to contraction. However, future business indicators remain in expansion across all major sectors, suggesting sustained optimism and growth momentum in the post-election period."
The PMI is a forward-looking index ranging from 1 to 100. A reading of 50 indicates stagnation, values above 50 signal expansion, and readings below 50 suggest contraction.
It is regarded as a crucial and timely indicator of the health of the manufacturing, services and construction sectors.
To enhance understanding of the index, MCCI Dhaka will organise a seminar on January 19, where Bangladesh Bank Governor Dr Ahsan H Mansur is expected to attend as chief guest.
Jasimharoon@yahoo.com