Central bank buys dollars amid strong remittance inflow; purchases exceed $3 billion

Staff Report: PNN

Since the beginning of the current fiscal year, Bangladesh Bank has purchased more than $3 billion from the market, taking advantage of the strong remittance inflow. Officials explained that the main goals are to stabilize the Taka-dollar exchange rate and strengthen foreign currency reserves.

As of the latest data, the country’s gross foreign currency reserve stands at $32.80 billion (BPM6 methodology: $28.11 billion), the highest in nearly three years. Strong remittance inflows continue, with about $275 million sent through banking channels in the first 27 days of December. Total remittances since the beginning of the fiscal year amount to approximately $15.79 billion, a 17% increase compared to the same period last year.

Last year, Bangladesh set a new record with total remittances exceeding $30 billion. The consistent inflow has increased dollar availability in the market, while export earnings have grown comparatively slowly (less than 1% in the first five months).

Currently, the interbank dollar rate is stable at about 122 Taka, positively impacting imports and inflation. According to Bangladesh Bank, the central bank has bought $3.0465 billion from banks this fiscal year while releasing approximately 37,000 crore Taka to the market. In December alone, around $920 million was purchased against more than 11,000 crore Taka released. Economists say maintaining strong remittances alongside gradual export growth can further stabilize the dollar market.