Boston, MA -- (SBWIRE) -- 10/17/2014 -- Core Views:

- Bangladesh will benefit from the power struggle between China and India for dominance of South Asia and the Indian Ocean, as the two giants will want to strengthen their political, economic and defence cooperation with Dhaka. This bodes well for Bangladesh's long term economic growth, which we are forecasting to come in at an annual average rate of 6.3% over the next 10 years.

- With the return of political normalcy, we are optimistic that investment and export sector growth will start to pick up over the coming quarters, and are forecasting real GDP growth of 6.3% in FY2014/15.

- We expect the Bangladesh Bank to keep its repo rate unchanged at 7.25% in H1FY15 (July-December), as inflation will likely remain relatively benign, while the economy should recover from the recent political turmoil.

- The recent increase in electricity prices will enable the government to reduce energy subsidies and narrow the fiscal deficits. With this positive development, we are forecasting the budget deficit to come in at 3.1% of GDP in FY2013/14, before falling marginally to 3.0% of GDP in FY2014/15.

- We expect the Bangladeshi taka to remain fairly stable near its current level of BDT77.65/USD over the coming months, as the Bangladesh Bank (BB) will likely continue to anchor the currency while it bolsters its foreign reserves. However, we see scope for mild appreciation over the course of the year as the garment export sector recovers amid renewed political stability.

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Major Forecast Changes

- While we initially forecasted a 50 basis points cut in interest rates to support growth, rising inflationary pressures will likely hold back such a move. As such, we forecast the central bank to maintain a neutral monetary policy stance for the remaining months of FY2013/14, and will keep its benchmark repo rate unchanged at 7.25%.

Key Risks To Outlook

- Downside Risks To Interest Rate Forecast: We believe that inflationary pressures will likely subside over the medium...

The Bangladesh Business Forecast Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in The Bangladesh and is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market..

An influential new analysis of Bangladesh's economic, political and financial prospects through end-2017, just published by award-winning forecasters, Business Monitor International (BMI).

Key Uses:

- Forecast the pace and stability of Bangladesh's economic and industry growth through end-2017.

- Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.

- Assess the critical shortcomings of the business environment that pose hidden barriers and costs to corporate profitability.

- Contextualise Bangladesh's country risks against regional peers using BMI's country comparative Risk Ratings system.

- Evaluate external threats to doing business in Bangladesh, including currency volatility, the commodity price boom and protectionist policies.

The Bangladesh Business Forecast Report by Business Monitor International (BMI) includes three major sections: Economic Outlook, Political Outlook and Business Environment.

Economic Outlook:

How will the Bangladeshi economic policy-making and performance impact on corporate profitability over 2013-2017?

BMI provides our fully independent 5-year forecasts for The Bangladesh through end-2017 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Bangladesh Business Forecast Report features BMI's forecasts with supporting analysis for 2013 through to end-2017, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

- Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.

- BMI's comprehensive Risk Ratings system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

- Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).

- Balance of Payments - trade and investment, current and capital account.

- Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).

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