This issue of Bangladesh Economic Update discusses the continuous fall in the capital market of Bangladesh. Continuous decrease in the capital market has not only destabilised the entire capital market but also has dragged out a huge number of small investors from the market leaving behind their investments. The report is an assessment of the previous and recent downward trend in the capital market along with the initiatives taken by the government to address the downturn of the market. An analysis of capital market depends on the observed trends in market capitalization, investment capitalization ratio, turnover, volatility of share index, the number of listed companies and monetary policy. Generally, the size of market is positively correlated with the ability to mobilize capital and diversify risk of an economy. In addition, market capitalization ratio equals the value of listed shares divided by GDP.