The central bank governor projects cooling the red-hot inflation, which has hovered above 9 percent since March last year, to 7 percent by June next year.

His optimism mainly stems from monetary tightening and duty cuts on essential commodities.

But the problem is that neither multilateral lenders nor local economists are in support of his projection -- at least not by the June 2025 deadline.

Bangladesh Bank Governor Ahsan H Mansur, an economist who has served the International Monetary Fund (IMF), is presumably well aware of the disagreements.

He also knows that any delay in easing price pressures will only be met with disbelief, disgust and frustration from the people.

Speaking of exhaustion, take the case of Abul Hasan, a 32-year-old private jobholder, who was about to buy a slice of cake to enjoy with his tea at a roadside stall at Farmgate in Dhaka.

"How much is the cake?" he asked the vendor while taking it from a dangling polythene bag.

"Tk 20," the shopkeeper replied.

"Tk 20 for this slim slice?" Hasan thought he had heard wrong. "I couldn't even hold the piece of cake for a while," he joked, before turning serious and asking, "How long can I bear the extra burden of expenses for my family? I am already tired and disgusted with the unusually high commodity prices."

Hasan's frustration mirrors the sentiments of millions of Bangladeshis as inflation remains stubbornly high, with food inflation crossing into double digits.

Inflation hit a four-month-high of 11.38 percent in November, while food inflation soared to 13.80 percent from 12.66 percent in October, according to data from the Bangladesh Bureau of Statistics.

The 12-month average inflation stood at 10.22 percent in November, up from 10.05 percent in October.

This leaves the Bangladesh Bank and economists disputing where to target to blunt the price curve: the supply side or the demand.

In its latest outlook, the World Bank stated that inflation might moderate by fiscal year 2024-25, but it is expected to remain near 9 percent, far above the target of 7 percent by mid-2025.

The IMF has projected average inflation of 10.7 percent for this fiscal year owing to political turbulence and major floods in August and September.

Besides, the multilateral lender also noted supply chain disruption and rising input costs due to currency depreciation as factors contributing to elevated inflation.

The Asian Development Bank (ADB) also projects double-digit inflation in the fiscal year 2024-25, citing similar reasons to the IMF.

However, the Bangladesh Bank, in its mission to cool inflation, has largely targeted the demand side.

IS DAMPING DEMAND THE SOLUTION?

In recent months, what the central bank has been trying to accomplish is to limit the flow of money in the market and thus control demand.

After assuming office in the second week of August this year, Mansur raised the policy rate three times, taking the total number of tightening measures to five this year, to 10 percent.

The policy rate is the rate at which commercial banks borrow from the central bank.

Recently, a high-powered committee of the Bangladesh Bank, chaired by the central bank governor, decided to maintain the rate until the desired level of inflation is achieved.

If that doesn't work, Mansur hinted at further tightening at a programme last week.

Apart from the tightening measures, other issues such as the country's dollar stock and bringing discipline to the financial sector have come under the spotlight as economists argue over the course of the battle against inflation.

WHAT ABOUT SUPPLY-SIDE CAUSES?

The Bangladesh Bank has raised policy rates in an attempt to curb inflation, but this monetary tightening has its limitations, said Mustafa K Mujeri, a former chief economist of the central bank.

To battle inflation, he called for addressing supply-side deficiencies.

"It is not possible to reduce inflation solely by increasing the policy rate," said the economist.

"Other policies, such as market management, monitoring and eliminating unnecessary manipulation of commodity prices, are critical.

"Without these, there is no possibility of controlling inflation," he added.

Besides, the former chief economist of the central bank reminded that higher borrowing costs raise production costs for businesses, deter new investment and consumption, and potentially stall economic growth.

He said rising input costs, particularly for energy and raw materials, have constrained industrial output, especially for small and medium enterprises.

Many businesses are operating below capacity, reducing supply and ultimately driving up prices, the economist said.

This means over-tightening can harm the fight against price pressure, but determining the right point is not an easy task.

DOLLAR STOCK MATTERS TOO

Monzur Hossain, a research director at the Bangladesh Institute of Development Studies, said: "I don't think inflation will come down to 7 percent in the next five to six months. Key indicators – such as forex reserves and the exchange rate – do not support such an optimistic projection."

He said if foreign exchange reserves remain low, the financial sector does not function properly and the exchange rate is unstable, it will be difficult to reduce inflation soon.

In recent months, remittance inflows have continued to rise, providing a breather for a country facing multiple challenges.

Despite that, the US dollar has recently jumped further to Tk 125 against the taka after remaining stable at Tk 120 for months.

A pricier dollar makes imports more expensive, while dollar rate volatility complicates the inflationary outlook.

INFLATION COOLING NEEDS MORE TIME

At a programme on Thursday last week, Mansur admitted that inflation has not yet come down, although monetary policies have been tightened and fiscal measures implemented to control domestic borrowing.

"I think all the medications that could be applied have been applied in order to reduce inflation. We are waiting for the body to react to the medication. We are waiting for the economy to react to the doses of economic policy tightening," Mansur said.

Apart from tightening the monetary policy, Mansur said the government has also removed import duties on essential food items like onions, vegetable oil, and sugar to help ease inflationary pressures.