The United States has announced the biggest interest rate hike in 28 years to tame soaring inflation, which will naturally give a further rise to dollar rates.
Commodity prices that swelled globally owing to the Russia-Ukraine war have now lost some heat, but we will not benefit from it if dollar prices go up further.
Two or three months ago, we purchased one dollar at Tk86-Tk88. We can now buy $3-4 lakh for Tk94-Tk95 per dollar. But when we go for a big purchase, the rate is Tk98-Tk99 per dollar.
If dollar prices rise, so do import costs – this is what we are now experiencing. A further rise in dollar rates because of the biggest interest hike in decades in the US means there will be no fall in skyrocketing commodity prices. This will make us suffer more.
Commodities, such as oil, wheat and sugar we already have imported for our local market cost much higher. At a time when we are supposed to benefit from a fall in prices of these essential products in the international market, the interest rate rise by 75 basis points in the US will play spoilsport.
So, chances of product prices falling down in the local market are very slim. Instead, there is now a possibility of another surge in commodity prices. But exactly how much the prices will increase will depend on the dollar rates in the future.
We have to keep it in mind that if the dollar interest rate rises, its supply will also decrease a bit, which will intensify the dollar crisis.
If the dollar rate goes up, we will not have control over it.
Taslim Shahriar is senior AGM of Meghna Group of Industries