Bangladesh forex reserve exceeds $45b amid high remittance inflow

Staff Correspondent | Published: 20:01, May 03,2021 | Updated: 22:44, May 03,2021

 
 

The country’s foreign exchange reserve on Monday exceeded $45 billion amid a slowdown in import payments following the fresh spike in Covid infection cases and a surge in remittance inflow ahead of Eid-ul-Fitr, one of the biggest religious festivals of Muslims.

Bangladesh Bank executive director and spokesperson Md Serajul Islam told New Age on Monday that the country’s reserve reached $45.105 billion on the day.

Remittance inflow reached a record $20.67 billion in the JulyApril period of the fiscal year 2020-2021.

However, the reserve would again fall below the $45-billion mark after the payment of $1.743 billion to the Asian Clearing Union on Wednesday for the country’s imports in March and April.

Given the increased public movement and economic activities before the imposition of fresh Covid restrictions on movement, the reserve pile-up slowed down and the reserve dropped to $43.61 billion on April 5 after reaching $44.05 billion on February 28.

The BB data showed that the country’s import payments increased by 1.91 per cent to $37.07 billion during the period under consideration against $36.37 billion payments in the same period of FY20.

BB officials, however, said that import had dropped significantly following the fresh spike in Covid-19 infections and imposition of restrictions on movement from April 14.

The country’s reserve started to pile up in June 2020 following the coronavirus outbreak in the country on March 8 and the subsequent imposition of movement restrictions, causing economic activities to come to a halt.

When economic activities remained almost suspended, the spike in remittance inflow compelled the BB to heavily buy the greenback from the local market to keep the dollar rate stable at around Tk 84.8.

As a result, the reserve reached the $34-billion, $35-billion and $36billion marks in June and reached the $42-billion mark in just six months.

The reserve has risen by $11 billion since the Covid-19 outbreak in the country to exceed $45 billion on Monday.

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