Inflation in Bangladesh: A Supply Side Analysis

Abstract

This paper attempts to verify that the supply side factors are no less contributory than demand side factors to generate inflation in the Bangladesh economy. An analysis of the inflation trend of recent years suggests that supply side phenomena such as food price hike, exchange rate depreciation, soaring import cost, wage rate increase, oil price hike etc have contributed significantly to price inflation. The findings of the study prompt policy makers to take supply side issues into active consideration before taking measures for combating inflation.