The country’s foreign exchange reserves crossed $22-billion mark for the first time on Thursday as Bangladesh Bank has already purchased US dollars worth $776 million in this financial year to keep taka stable against greenback. A BB official told New Age on Thursday that foreign exchange reserves stood at $22.05 billion on Thursday as the central bank purchased $158 million from the local banks on the day.
He said that the central bank had purchased greenbacks worth $5.15 billion in the FY 2013-14 and $4.53 billion in the FY13 from the scheduled banks which were grappling with the dollars because of lack of demand.
The central bank started to purchase greenbacks after the Bangladeshi currency had fallen to around Tk 84 a dollar in the first half of 2012 from around Tk 71 in the previous year, he said.
After the BB had bought huge amount of foreign exchange in the last few financial years, the taka became stable at around Tk 77.75 a dollar between May 2013 and February 2014.
Despite the central bank’s dollar buying spree, the greenback started to depreciate in July although the exchange rate of the dollar became stable in the last few days as it was quoted (buy-sales) at Tk 77.50-Tk 77.50 in the period.
The US dollar depreciated significantly against the taka in July as the expatriate Bangladeshis sent record amount of greenback in the period on the occasion of Eid-ul-Fitr which was celebrated on July 29.
The expatriate Bangladeshis sent $1.48 billion in July that compelled the central bank to purchase greenbacks to keep stable the dollar against the taka.
The reserves crossed $15-billion mark on May 7, 2013, $16-billion mark on August 13, $17-billion mark on October 22, $18-billion mark on December 19, $19-billion mark on February 19, 2014 and $20-billion mark on April 10, 2014 and $21-billion mark on June 16, 2014.
BB governor Atiur Rahman told New Age that the country would be able to meet the import cost of seven months by using the current foreign exchange reserve.
He said that the robust amount of export earnings along with a steady growth of inward remittance in the recent months also played a significant role in increasing the reserves.
The central bank has recently increased the volume of Export Development Fund to $1.5 billion that pushed up the export earnings, said Atiur.
Former interim government finance adviser Mirza Azizul Islam earlier told New Age that ‘big-but-idle’ reserve was not good for the economy.
‘There is no transparency in the method how Bangladesh Bank is increasing the foreign currency reserves. BB should clearly say how it is hiking its reserves,’ he said.
‘The central bank is increasing the reserves by buying huge volume of dollar from the scheduled banks to keep the exchange rate stable, whereas it is allowing local businesses to borrow foreign currency from overseas with hard-term,’ he said.
Azizul said that BB should be more generous to local businessmen in allowing them to import industrial raw materials and capital machinery with the reserves.
-With New Age input
