Dollar weakens against taka

The US dollar has weakened against the taka despite the central bank’s intervention to keep the greenback stable.

Bangladesh Bank bought dollars at Tk 77.48 on Thursday against Tk 77.75 in late April.

In the interbank money market, dollar was being traded at Tk 77.50 and banks were buying it at less than Tk 75 from the public on Thursday.

Taka has strengthened against dollar at a time when the Indian rupee has lost ground against the US currency.

Economist Zaid Bakht has attributed the weakness of the greenback to an increase in the remittance inflow, export earnings and foreign aid release.

Bangladesh Bank has been buying the greenback to keep its price stable.

It bought $270 million in the first eight days of the current 2014-15 fiscal year, beginning on July 1. The figure was $5.15 billion in the whole last FY and $4.79 billion in 2012-13 FY.

Bakht, Research Director at the Bangladesh Institute of Development Studies (BIDS), said: “Even after an increase in import expenditure, the central bank has (foreign exchange) reserves of $22 billion, which can meet import cost of more than seven months.”

“... these huge reserves have strengthened the taka,” he said.

Dollar was stable for around a year after the central bank stepped in, but it weakened in late May this year, when it sold at Tk 77.65. It was selling at Tk 77.48 for two and a half months.

On Thursday, state-owned Sonali Bank purchased the US unit at Tk 76.93 and sold at Tk 78.15.

HSBC bought and sold it at Tk 76.76 and Tk 78.10 respectively.

The forex reserves with the central bank were $22.05 billion on Thursday.

According to the Export Promotion Bureau (EPB), Bangladesh earned $30.18 billion from exports in 2013-14 FY, registering a 12 percent increase over the previous year.

Meanwhile, the expatriate Bangladeshis remitted a record $1.48 billion in July.

The remittance, however, recorded a decline of 1.6 percent in the last FY compared to that of the previous year.