Forex reserves at $19.89b

Bangladesh's foreign exchange reserves stood at $19.89 billion on Thursday, as per the International Monetary Fund's (IMF) BPM6 method, according to the latest Bangladesh Bank (BB) data.

It also showed that the gross reserves were at $25.30 billion on the same day.

The reserves were at $20.11 billion before the Eid-ul-Fitr holidays.

The central bank started following the international standard in calculating reserves as per a condition set by the IMF for a $4.7 billion loan approved for Bangladesh last year to mitigate the still ongoing forex crunch.

An analysis of the Balance of Payment (BoP) data clearly indicates that the government has been mostly unable to curb the steady loss of foreign exchange reserves.

BB pumped $8.22 billion of support from the reserves to stabilise the BoP in FY2022-23, which was $6.5 billion in FY2021-22. As a result, gross reserves fell from $41.82 billion to $31.2 billion in FY2022-23.

Calculated under IMF’s BPM6 method, the reserves would have stood at $33.38 billion and $24.75 billion in FY22 and FY23, respectively.

At the end of FY23, Bangladesh had the capacity to cover 4.6 months of import expenses with the reserves.

Experts warn that as this figure continues to decrease, it will take down the country’s capacity for essential commodity imports.