Foreign currency reserves exceed $31 billion again due to rising remittances and exports

Bangladesh’s foreign currency reserves have once again surpassed $31 billion, boosted by high growth in remittances, increased export earnings, and financial assistance from various international organizations.

According to the latest data from Bangladesh Bank, the gross reserve stood at $31.33 billion at the end of the day on Wednesday, 27 August. At the same time, according to the IMF’s BPM-6 accounting, the reserve was $26.31 billion.

In the first week of July, when Bangladesh made a $202 million payment to the Asian Clearing Union (ACU), the gross reserve temporarily fell to $29.53 billion, while the BPM-6 figure was $24.56 billion. Previously, on 24 August, the gross reserve was $30.86 billion, and $25.87 billion according to BPM-6.

The net or actual reserves are calculated by subtracting short-term liabilities from the total reserve. The central bank also maintains a “usable reserves” figure, which is not officially published. This accounts for dollars in the IMF’s SDR account, banks’ foreign currency clearing accounts, and ACU bills. According to this measure, the country’s usable reserves have exceeded $20 billion, sufficient to cover more than three months of import expenses at a rate of $5.5 billion per month.

It is important for a country to maintain reserves equal to at least three months of import costs. These reserves ensure economic stability and provide security in foreign transactions.