Thursday, 29 September, 2022
E-paper

No absolute dependence on USD

At a tripartite meeting among the Bangladesh Bank, Bangladesh Foreign Exchange Dealers’ Association and Association of Bankers’ Bangladesh, it was decided to fix the buying and selling rates of the US dollar after a spate of volatility in the country’s foreign exchange market. This instability created an imbalance in the country’s import-export business and remittance inflow. The situation, among others, exerted extra pressure on the country’s foreign exchange reserve and led to its decrease in volume.

Obviously with the objective of – first, bringing stability in the foreign exchange market; secondly, attracting more remittance from our migrant workers through proper exchange houses, encouraging exports and discouraging import of luxury goods and finally strengthening the foreign exchange reserve and thus securing macroeconomic stability, new exchange rates of US dollar have been fixed, scheduled to be enforced from Monday. As per the decision, the exchange rate will be Tk. 108 per unit dollar in case of inward remittance, Tk. 99 for export earnings and while opening of letter of credit for imports, businesses will have to pay Tk. 104.5 for a dollar. The good piece of news in this regard is that all banks have agreed to adhere to the exchange rate decision, which is to be reviewed from time to time. It is hoped that with the implementation of the new rates, the above objectives will duly be achieved.

It is also believed that fixed currency exchange rates will lead to stabilisation of Taka against dollars, and thus help rein over the inflationary market situation and maintain people’s purchasing power. Potential foreign investors are also likely to feel encouraged to invest in the country. Stakeholders should try hard to harvest the highest benefits from the new measure.

After an initial hiccup, the situation with the country’s foreign exchange reserve is likely to turn for the better, following the beginning of food grain export from Ukraine and reduction in fuel oil prices in the global market. With the enforcement of the new foreign exchange rates, the foreign exchange reserve is going to recuperate its health soon. Bangladesh should also come out of almost absolute dependence on US dollars in its foreign trade. The idea of introducing alternative currencies in foreign trade will be of great help in coming out of dollar-dependency.