Experts have highlighted that the accumulation of money outside Bangladesh’s banking system, which has now exceeded Tk 2.63 trillion, is contributing to inflationary pressures. This surge in currency outside the banks experienced an upturn in April 2023 after three months of decline. The uncertainty prevailing in both local and global markets has led individuals to hold cash, exacerbating the situation.
Inflationary pressures, coupled with rising living costs, have compelled depositors to withdraw money from the banking system, resulting in the expansion of currency outside the banks. This phenomenon refers to legal tender held by the public and has seen a significant increase in recent months.
Bangladesh Bank’s latest statistics reveal that the volume of money outside the banking system grew by over 11% year-on-year in April 2023, reaching Tk 2.63 trillion. This represents an increase of Tk 87.05 billion compared to the previous month. Factors such as increased spending during Ramadan and Eid-ul-fitr, as well as a depreciating local currency prompting investments in US dollars, have contributed to the surge in cash held outside the banks.
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