Dollar rises to Tk86.45 in interbank market

The interbank exchange rate increased by Tk0.25 and stood at Tk86.45 per US dollar on Wednesday.

The value of the taka has been declining in the domestic market due to an increase in imports and rise in the price of goods in the international market following the Covid-19 lockdowns, said relevant sources.

The interbank exchange rate reached Tk86.20 by increasing Tk0.20 on 23 March, and remained the same till Tuesday.

Although the exchange rate was Tk86.45 in the interbank market, banks sold dollars to customers at Tk90-92. In the curb market, it was sold at Tk92-93.

According to industry insiders, a crisis has arisen due to the rise in imports and decline in remittances. Meanwhile, the foreign exchange reserve has also been declining. To keep the market normal, the Bangladesh Bank continues to sell dollars.

Sources at the Eastern Bank and the Brac Bank said they sold dollars at Tk92.50 on Wednesday. However, they sold it at the interbank market at Tk86.50.

A head of treasury department at a government bank told The Business Standard, "There is a very high demand for dollars in the market. A private bank wanted to buy $54 million today, but we could not sell it due to low reserves."

He said the importers are supposed to open letter of credits (LCs) at Tk86.45 per dollar for importing goods, but many banks cannot sell dollars at that rate due to a shortage. So, the importers have to open LCs by buying dollars from other banks at a higher price.

Bangladesh Bank Executive Director and Spokesperson Md Serajul Islam told TBS, "During the last wave of Covid-19, we bought dollars from banks, which raised the central bank's reserves to $48 billion in August last year."

Demand for the dollar has risen in the market as imports increased since the beginning of this year. So, the central bank has been selling dollars as per the demand.

"The central bank has sold $521 million to banks this month alone. It has sold over $4 billion in the last nine months," said Md Serajul Islam.

In the first July-February period of the current fiscal year, the country's import expenditure stood at $58.77 billion, which was 46.68% more compared to the same period in the previous year.

At the same time, exports in the first nine months of the current fiscal stood at $38.60 billion, which was 33.41% higher compared to the same period last year.

Bangladesh received $15.30 billion in remittances in the first nine months of the current fiscal – a 17.7% decrease compared to the same period a year ago.