To keep Taka stable by continuing appreciation in Taka’s value, and protect the interest of the exporters as the export sector is facing pandemic induced downturn, the central bank purchased record high $7.68 billion in the first 11 months of the outgoing FY.
The initiative was taken due to a higher flow of remittance and lower imports induced by business downturn during pandemic.
The previous highest was posted in 2013-14 when Bangladesh Bank bought $5.15 billion.
The central bank needs to prevail the intervention until the economy recovers from the slowdown, according to the experts.
The foreign exchange reserves have also surged due to dollar purchase. But it has flooded the financial sector with excess liquidity. The excess liquidity in the banking industry stood at around Tk 200,000 crore in April.
On the other hand, as liquidity remained idle largely, a lower credit demand has negatively impacted the cost of funds.
Meanwhile, it is expected that Bangladesh would continue enjoying the excess dollar in the coming days due to the higher flow of remittance. The swelled reserves will help the country when import will find its pace.
Between July and May, Bangladesh received $22.8 billion in remittance, already the highest in a single year. Foreign reserves stood at $45.08 billion on June 2 (Wednesday), up 34.70 per cent from previous year.