Bangladesh’s forex reserves ‘close to’ $20bn

The central bank says that as inter-bank loans are active, the foreign exchange rate or dollar price is expected to remain stable

Bangladesh’s foreign currency reserves stand at around $20 billion, according to Bangladesh Bank spokesperson Husne Ara Shikha.

“According to the latest data, foreign exchange reserves amount to $24.3 billion US dollars. It is close to $20 billion according to the BPM-6 calculation standard of the IMF,” she said in a statement on Tuesday.

Net reserves are calculated according to the International Monetary Fund’s BPM-6 measure. Subtracting short-term liabilities from gross or total reserves gives the amount of net or actual reserves.

The central bank published the information on reserves from July 2023 after the IMF’s loan approval.

According to the information released by central bank on Thursday, the amount of reserves stood at $19.44 billion that day.

Stating that the amount of reserves is increasing, spokesperson Shikha said, “It is becoming possible to prevent the loss of foreign exchange reserves because remittances are increasing. Compared to the last fiscal year, there has been a 60 percent growth in this fiscal year.

“If we take the growth in August and July together, it is about 90 per cent growth. Interbank foreign exchange trading is enabled. Banks are able to trade themselves if they want to and the exchange rates are market based.”

She said, "The price of the dollar is currently Tk 118-120. The difference between the dollar price in the banking channel and the curb market price is now less than 1 percent.”

Shikha said, "We believe that the foreign exchange rate market or the dollar price will stabilise due to active inter-bank transactions."

In the last two fiscal years, Bangladesh Bank has sold dollars from reserves to commercial banks to open government bonds or LCs. By doing so, foreign exchange reserves have fallen.

After the fall of the Awami League government, the central bank’s new Governor Ahsan H Mansur said that he has stopped selling dollars from the reserve.

This will increase the reserves and there is no "possibility" of reduction, he said.