Bangladesh Bank’s forex purchases surge past $6bn before fiscal year-end

With exchange rates now market-driven, the central bank continues buying dollars from commercial banks to steady the currency market and prevent sharp swings

Bangladesh Bank’s aggressive dollar-buying spree shows no signs of slowing, pushing total purchases past $6 billion in the ongoing fiscal year even before the final month has begun.

The central bank has now bought more than double the volume of foreign currency this month compared with the previous one, underscoring its sustained intervention in the interbank forex market to stabilise exchange rates.

On Tuesday, Bangladesh Bank purchased an additional $85 million from six commercial banks through an auction mechanism at a rate of Tk 122.75 per dollar, according to officials.

A day earlier, on Monday, the central bank had bought $100 million from the same number of banks at the same exchange rate.

With these latest transactions, dollar purchases in May have reached $395 million so far, compared to $180 million in April.

Overall, Bangladesh Bank has now purchased $6.07 billion during the first 11 months of the 2025–26 fiscal year.

Explaining the continued intervention, Bangladesh Bank Executive Director Arief Hossain Khan said the purchases aim to keep the foreign exchange market stable amid rising inflows from remittances.

“As remittance inflows have increased sharply, dollar supply in the market has gone up. To maintain stability -- so that the dollar rate does not fall sharply -- the central bank is buying dollars from banks,” he told bdnews24.com.

“A rising dollar is not good for the economy, and neither is a falling one. So the central bank is stepping in to keep the market stable. This also helps increase liquidity in the banking system,” he added.

Following the shift to a market-based exchange rate regime, Bangladesh Bank began regularly purchasing dollars from commercial banks through auctions on Jul 13, 2025, to manage volatility.

Since then, the central bank has remained active in the market, though there was a brief pause of about one and a half months between Mar 3 and Apr 15, during which no purchases were made.

Buying resumed on Apr 16 and has continued steadily since.

Monthly figures show Bangladesh Bank bought $1.54 billion in February, $798 million in January, and $1.09 billion in December, reflecting sustained intervention even before the current fiscal cycle.

Officials say dollar purchases, combined with strong remittance inflows, have supported a recovery in foreign exchange reserves.

However, reserves temporarily declined earlier this month after Bangladesh settled $1.51 billion in dues to the Asian Clearing Union (ACU) for the March–April settlement period.

Following that payment, the central bank resumed active purchases from the market.

As of Monday, gross foreign exchange reserves stood at $34.31 billion, while reserves calculated under the BPM6 international standard were $29.65 billion, according to Bangladesh Bank data.