BB governor says exchange market is free floating despite IMF concerns
There is no intervention in the market, he says
Bangladesh Bank Governor Ahsan H Mansur today (2 November) insisted that the country's foreign exchange market is operating in a completely free-floating state, responding to concerns raised by the visiting International Monetary Fund (IMF) team.
The governor met with the IMF delegation around 5pm, with several deputy governors and executive directors also present.
An executive director, who was present at the meeting, told The Business Standard that the IMF team observed that Bangladesh's foreign exchange market is not yet fully free floating.
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In response, Governor Mansur said, "We are in a completely free-floating state. There is no intervention in the market."
When the IMF team questioned why Bangladesh Bank continues to buy dollars from the market if there is no intervention, the governor explained that such operations are typical for export- and remittance-dependent countries.
"Countries like Japan also buy dollars from the market," he said.
He added that banks currently have sufficient dollar reserves, and import demand is somewhat low, resulting in excess dollars in the market, which the central bank is absorbing through purchases.
