The taka depreciated again against the US dollar on the interbank platform yesterday.
The exchange rate was 94.45 Tk for one dollar. It was Tk 93.95 on Wednesday.
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On July 21 last year, the rate was 84.80 Tk, which means that there was a loss in value of 11.38% in one year.
The country’s foreign exchange market is facing a shortage of US dollars due to increased import payments and declining remittances.
Import payments have increased since the end of last year due to higher commodity prices on the world market.
Between July and May of the previous fiscal year, import payments rose 39% year-on-year to $75.40 billion, while exports rose 33% to $44.58 billion .
This resulted in a record trade deficit – the gap between exports and imports – of $30.81 billion, up 48.8% year-on-year.
The inflow of remittances, the cheapest source of foreign exchange for Bangladesh, fell 15% year-on-year to $21.03 billion in the 2021-22 financial year.
The country’s foreign exchange reserves stood at $39.67 billion on Wednesday, down from $46.15 billion in December last year.
Bangladesh Bank injected $70 million into the market yesterday to maintain market stability, central bank spokesman Md Serajul Islam told the Daily Star.
The BB has so far injected $808 million into the market this fiscal year after providing a record $7.62 billion in the previous fiscal year.
Ahsan H Mansur, executive director of the Bangladesh Policy Research Institute, said the central bank should reduce the injection of dollars into the market to protect reserves from the pitfalls of a downtrend.
He said state-owned banks, which now received the greenback from the central bank to import oil and other essentials, would have to manage the fund from other banks.
Ensuring a floating taka exchange rate against the dollar will help make the platform dynamic, as many lenders are reluctant to sell dollars using the window, he said.
Banks are now charging a much higher rate to sell dollars to importers than the central bank instructed them to follow, which is why the interbank platform has almost become inoperable.