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The Bangladesh Bank (BB) said that the supply of US dollars in banks is more than their requirement, so reducing the exchange rate is logical.
Bangladesh Bank spokesperson and Executive Director Mazbaul Haque said this at a press conference at the BB headquarters in Motijheel on Thursday.
He said that last year short-term foreign debt liability was $16 billion, now it is reduced to $6.9 billion.
Besides, there is a surplus of $1.0 billion in the current account. Now the LCs are opened with immediate dollar payment. In addition, the supply of dollars in banks is now more than the demand. As a result, the decision of the Bangladesh Foreign Exchange Dealers’ Association (BAFEDA) is correct, the BB spokesperson said.
He said that the US dollar price is determined depending on demand and supply. Dollars are used to purchase services and goods and to clear service debts and foreign liabilities. Now the import price is being monitored.
As a result, the demand for dollars has reduced, he said.
On Wednesday, for the first time in more than a year, banks decided to lower the exchange rate of US dollar. The decision to reduce the price of the dollar by Tk0.50 has come into effect from Thursday.
Besides, the price of the dollar has decreased by Tk 0.50 paisa for sale to importers.
The BAFEDA and the Association of Bankers Bangladesh (ABB) decided to reduce the dollar price in a meeting held in the evening on Wednesday. According to the decision, the price of the dollar to buy expatriate and export earnings will be Tk 110, which was earlier Tk 110.50.
To meet the import liability, the dollar price can be taken as Tk 110.50, which was Tk 111 earlier.
However, in addition to the government’s 2.5 per cent incentive on expatriate income, banks can also give the same amount of incentive. As a result, the beneficiaries will receive a maximum of Tk 115.50 per dollar for inward expatriate income.
Despite such a statement from the BB, the banks still bought expatriate income at the rate of Tk 121 and more per dollar.