In a move to stabilise the forex market, Bangladesh Bank, the central bank of the country, sold $6.05 billion to commercial banks directly from its foreign exchange reserves between July and November in the current fiscal.
The central bank never released such a big amount of dollar in the history of Bangladesh in a single fiscal year. It has sold more than six billion dollar within only five months in the current fiscal year while it sold $7.60 billion in the last fiscal year 2021-22, according to a report headlined ‘BB injects $6b to stabilise mkt’ published in this daily on Sunday.
As the central bank’s main job is to keep the money market stable, it is selling dollars in line with market demand. The central bank usually sells US dollars directly to commercial banks to meet higher demand for the greenback. Inflation has been reducing across the globe and it is also reducing in Bangladesh over the last three months. The overall inflation trend of Bangladesh is now in good shape and hopefully it will reduce further in the current month.
The central bank must
check both under-invoicing and
over-invoicing as well as
There is no crisis of US dollars in the country. So, there would be no such shortage of foreign currency in the country from March or April of next year. Therefore, there would be no problem related to foreign exchange reserve from January next year as the country’s exports and remittances have become surplus compared to imports. The central bank must check both under-invoicing and over-invoicing as well as foreign exchange smuggling. It will also have to look into the LCs’ values and actual market value of goods, which will continue to check foreign exchange smuggling through hundi.
It is clear that the government never wastes a single paisa from the foreign currency reserve, rather use money for the country and its people’s interest. It spends every penny for the interest and welfare of the people as it is determined to overcome the current crisis, save lives and accelerate economic recovery.
The reserve money is also used in purchasing capital machineries. Besides, the government has given loan from the reserve to Bangladesh Biman to purchase planes. So, the reserve is being used for the welfare of the people that include importing rice, wheat, edible oil, fuel oil and vaccines of the Covid-19, giving subsidies, investing in some projects and repaying the foreign loans. Therefore, selling of foreign exchange reserves to the commercial banks directly will help the money market to return to normal immediately.