Dhaka, Bangladesh (BBN)- Bangladesh's gross foreign exchange (forex) reserve has crossed over US$25 billion again following lower import payment obligations and higher inflow of remittances, officials said.
The forex reserve rose to 25.14 billion on October 15 from $24.97 billion on October 08 as per traditional calculation of the Bangladesh Bank (BB). It was $24.86 billion on September 30.
As per the International Monetary Fund (IMF)’s Balance of Payments International Investment Poisson Manual-six edition, generally known as BMP6, the forex reserves rose to $19.93 billion during the period under review from $19.83 billion, according to the central bank’s latest data, released on Wednesday.
The reserve was $19.86 billion on September 30.
The reserve, one of the major macroeconomic indicators of an economy, fell to $24.53 billion in terms of gross calculation of the central bank after clearing $1.37 billion import payments to the Asian Clearing Union (ACU) on September 07 last while the reserve stood at $19.46 billion as per IMF’s BMP6.
Talking to BBN a BB senior official said higher inflow of remittances have helped the country to cross $25 billion forex reserve further.
Bangladesh received $1.21 billion as inward remittances during the first 14 days of October 2024, according to the official.
Meanwhile, the flow of inward remittances grew by more than 33 per cent to $6.54 billion in the first quarter (Q1) of the current fiscal year (FY), 2024-25, from $4.91 billion in the same period of FY '24.
This surge indicates a growing trend of expatriates utilising formal banking channels to send money to Bangladesh, bankers said, adding that this increase to a shift away from informal methods like hundi since the formation of the new government.
Besides, purchasing of the US currency from the commercial banks directly has contributed to grow the forex reserve in recent days, another BB official said.
Nearly $50 million, so far, was bought from the commercial banks in October as part of the BB's intervention into the market, the official added.
On the other hand, selling of the US dollar from the central bank almost suspended recently aiming to build up the forex reserve in Bangladesh.
The central bank sold only $10 million so far to the commercial banks in the month of October 2024, according to the BB official.
However, the actual import in terms of settlement of letters of credit (LCs) fell by 5.58 per cent to $16.10 billion during the July-September period of the FY’25, from $17.05 billion in the same period of the previous fiscal year due to political unrest as well as uncertainty associated with post unrest regime.
On the other hand, the opening of fresh LCs, generally known as import orders, dropped by 8.44 per cent to $15.65 billion in the first three months of this fiscal from $17.09 billion in the same period of FY’24.
Bangladesh's forex reserves had surged to $48.04 billion on 24 August 2021, setting a new record, from $46.58 billion of the previous working day. The rise was after receiving $1.45 billion from the IMF as general allocation of Special Drawing Right (SDR).
BBN/SSR/AD