Bangladesh Bank sells $305m in August for import payments

Bangladesh Bank has increased the volume of dollar sales in August to clear import payments, according to a central bank source.

The central bank has sold $305 million to the scheduled banks in the second month of the 2021-22 financial year.   

The exchange rate of the US dollar has increased to Tk85.20 in August as its demand has risen recently. The rate was Tk84.80 in the same month of the last year.   

People concerned said the demand for dollars has increased in the inter-bank currency market as the country's import demand picked up recently and the remittance inflow has declined as well. 

On the contrary, the central bank has bought US dollars from the scheduled banks till July to keep the market stable. From August, the BB has started selling dollars following its increased demand.

Last year, Bangladesh Bank had sold 7.93 billion dollars to the scheduled banks.

Centre for Policy Dialogue (CPD)'s distinguished fellow Mustafizur Rahman said the banks are opening more letter of credits (LCs) than the previous time as the Covid-19 infections have declined slightly. So the demand for dollars has increased.

Besides, commercial banks have been buying dollars from the central bank as the remittance inflow has dropped significantly.

The Bangladesh Bank has a record reserve of $48 billion (Tk4,000 crore). Dollars will be sold in the market if the situation deserves, says a central bank source.

Economists said it is a natural process to increase the sale of dollars by Bangladesh Bank as its demand has increased.  It is an indication of the economic stability of the country, they said. 

From 5 August, the exchange rate of dollars has increased against taka. The Bangladeshi currency has depreciated to 40 paisa against the dollar.

On 5 August, the exchange rate of the dollar was Tk84.80 in the inter-bank currency market. 

The exchange rate of dollars remained unchanged for more than one year. The exchange rate of the dollar has risen in the last four weeks, and it stood at Tk85.20 last Thursday.