Dhaka, Bangladesh (BBN)– The exchange rate of the Bangladesh Taka (BDT) has depreciated significantly against the US dollar following higher demand for the greenback for settling the import bills.
The local currency depreciated by 10 poisha in the country’s inter-bank foreign exchange (forex) market on Monday after more than a month, according to market operators.
The US dollar was quoted at BDT 84.05 each in the inter-bank forex market on the day against BDT 83.95 of the previous working day, they said.
The local currency faced the depreciation, although the central bank sold US$ 85 million to the commercial banks on the day for keeping the forex market stable.
Talking to the BBN, a senior official of the Bangladesh Bank (BB) said the central bank has sold the US dollar to three state-owned commercial banks (SoCBs) for making import payments, particularly for fuel-oils, LNG (liquefied natural gas) and Rooppur Nuclear Power Plant (NPP).
The official also said the central bank is continuously providing such foreign currency support to the banks for making import payment obligations against the essential items.
A total of $1.55 billion has been sold since July 01 of the current fiscal year (FY), 2018-19, to the commercial banks as part of BB’s ongoing support, according to latest data.
The BB may continue providing such foreign currency support to the banks in line with the market requirement, the central banker hinted.
On January 03, the local currency depreciated by five poisha against the greenback in the inter-bank forex market on the same ground.
The greenback was quoted at BDT 83.95 each in the market on the day against BDT 83.90 of the previous working day.
Senior bankers, however, said the country’s overall export earnings and inward remittance flow will boost up following such depreciation of the local currency against the US dollar.
Such depreciation will also increase cost of imports, they added.
On the same day, the exchange rate of BDT depreciated by 17 poisha against the US currency at customer level for settling import bills.
The exchange rate of the US dollar rose to maximum BDT 84.12 each for sale of Bill for Collection (BC) on the day from maximum BDT 83.95 of the previous working day, according to the operators.
The local currency may depreciate further in future following the overall market situation, they hinted.
The demand for the US dollar is gradually increasing, mainly due to higher import payment pressure, particularly of capital machinery for power plants, intermediate goods, petroleum products and LNG.