Dhaka, Bangladesh (BBN) – Bangladesh plans to buy gold for diversifying its foreign currency reserve amid fluctuation of the US dollar against major international currencies which poses challenge to its foreign currency reserve hovering more than $10 billion over the last one year.
Bangladesh Bank (BB), the country’s central bank, is now examining the amount of gold it would buy from the world market following an instruction by the ministry of finance early this month.
Finance minister AMA Muhith told New Age, a local newspaper, that suggestion had been given to the central bank to examine the option of increasing the reserve of gold.
“The BB needs to increase the reserve as the amount of gold it holds is not much,” he said.
The BB has gold reserve of 3.5 metric tons, according to International Monetary Fund. The market price of the gold is roughly $137.9 million as per ounce of gold is selling at $1,226 in the world market on August 20, 2010.
The central bank plans mean the start of a significant shift away from the US dollar holding which has already been done by many countries, including India and Sri Lanka in South Asia, because of the weakening dollar against other international currencies, the Newspaper said quoting analysts.
BBN/SSR/AD-22Aug10-10:42 am (BST)