Dhaka, Bangladesh (BBN) – Bangladesh Taka (BDT) has been continuously depreciating against the US dollar (USD) despite the central bank’s strengthening of foreign exchange support to the banks for settlement of import bills, treasury officials said.
The BDT depreciated by 1.14 per cent against the US dollar during the last two weeks, following an increased demand for the greenback in the market to settle import payments by the commercial banks.
The rate of the US dollar in the inter-bank foreign exchange market reached the maximum level of BDT 72.80 on Thursday from BDT 71.98 on March 17, according to the central bank statistics.
“We’re trying to check the depreciation of the local currency against the greenback through providing foreign exchange support to the commercial banks,” a senior official of the Bangladesh Bank (BB) said, adding that the BDT has depreciated against the greenback due mainly to higher import pressures during the recent months.
The country’s overall imports grew by nearly 44 per cent during the first seven months of this fiscal, due to a jump in import of food grains by over 86 per cent.
Letters of credit (LCs) against imports worth US$ 18.059 billion were settled during the July-January period of fiscal 2010-11, compared to $12.557 billion during the corresponding period of the previous fiscal, the BB data showed.
The BB official said the central bank has strengthened its foreign currency support through selling the US dollar directly.
Besides, the BB is also providing overdraft (OD) facilities to the commercial banks to settle payment bills against import of essential items, including food grains, petroleum products, and power plant equipment.
As part of the operation, the central bank Thursday sold $15 million at market rate directly to a state-owned commercial bank (SCB) to meet the growing demand for the greenback.
The US dollar was quoted at BDT 72.75 – BDT 72.80 in the inter-bank foreign exchange market on the day against BDT 72.70 – BDT 72.77 of the previous working day.
Besides, the BB has provided OD facilities of $50 million to two SCBs on the same day for the same ground, the central bank official added.
“Such foreign currency support will continue in line with the market requirement,” another BB official said, adding that the central bank was closely monitoring the overall market situation.
Treasury officials said the existing upward trend of the US dollar in the inter-bank foreign exchange market may continue in the coming days also due to higher demand for the greenback.
BBN/SI/AD-01Ape11-1:31 am (BST)
