Banks to buy dollars from exchange houses at Tk93 max

From now on, banks will pay a maximum rate of Tk93 to buy dollars from exchange houses as per a new decision made by the lenders' treasury department heads.

According to sources, the heads of the treasury departments of the country's public and private banks joined a meeting on the value of the dollar on Wednesday morning.

At the same time, the treasury heads said that it is not possible to open letters of credit (LCs) at low rates by buying dollars at higher prices from exchange houses.

They said they will take the next decision on this price in the next few days considering the situation.

Earlier in the day, banks had even collected dollars from exchange houses at Tk95-96. The heads of the treasury departments complained that several banks had offered higher prices to the exchange houses while the rest of the banks were having trouble buying dollars. In this situation, a new decision was made.

The meeting also decided to keep the dollar rate at Tk93 for opening LCs on imported goods this week. As per the decision, the opening rate of LCs on Thursday should be Tk93.

Mentioning that the Bangladesh Bank had a verbal instruction on the value of the dollar, the head of the treasury department of a leading private bank told The Business Standard, "We have all sat down and fixed a price."

"It remains to be seen to what extent banks will comply with the decision. If everyone complies with the decision, we will be able to cover the deficit by collecting dollars from exchange houses at a slightly lower price," he added.

Dollar price rises in the kerb market

Meanwhile, the dollar rose by at least Tk0.50 in the kerb market on Wednesday. In the informal market, the dollar was sold at Tk97.50 to Tk98.20. A day earlier, on Tuesday, the greenback was sold at Tk97, according to officials at several money changers at Motijheel and Naya Paltan in the capital.

Money changers also bought dollars at Tk96.50 to 97.20 on Wednesday. On Tuesday, they bought dollars at a rate of Tk96 to Tk96.40.

An official at an exchange house, who did not want to be named, told TBS that the Bangladesh Bank was constantly devaluing the dollar. Therefore, the dollar has risen in the kerb market. Money changers operate within the country. If the central bank takes any action, exchangers also feel the effect.

The prices of imported goods have gone up in the international market. As a result, import expenditure is increasing. Although the income from export has increased, it is not able to keep pace with the import.

At the same time, remittance income is declining. Overall, the dollar price has increased due to an increase in demand. This has also affected the country's kerb market.

Due to the crisis, the dollar rose to Tk103 on 17 May in this informal market. However, the next day the price fell below Tk100. Since then, the dollar has been fluctuating in the open market.

However, due to the small size of the market, the dollar has little effect on the main market.

Some relief in the dollar price

The Bangladesh Bank has strengthened its currency this time after depreciating it against the dollar in several phases since January this year.

The central bank raised the value of the taka by Tk0.50 against the greenback on Wednesday. As a result, the dollar was sold at Tk91.50 on the last one day in interbank transactions.

Sirajul Islam, a spokesperson and an executive director of the central bank, told TBS that the dollar rate fell by Tk0.50 on Wednesday. The Bangladesh Bank sold the greenback to banks at Tk91.50.

The rates are fixed based on demand and supply in an economy, he added.