Home ›› 12 Sep 2022 ›› Front
The Bangladesh Foreign Exchange Dealers’ Association (BAFEDA) on Sunday fixed a uniform exchange rate of the US dollar to curb the instability in the foreign exchange market.
The apex body of dealer banks set a maximum of Tk108 for foreign exchange houses to collect remittance and Tk99 for encashment export bills.
On the other hand, the rate of LC (Letter of credit) settlement will be the weighted average rate of the above two rates plus 1 taka.
The new rates of the greenback will come into effect from Monday.
The decisions were made during a meeting between the BAFEDA and the Association of Bankers, Bangladesh at the headquarters of state-run Sonali Bank in Dhaka’s Motijheel.
ABB Chairman and BRAC Bank Managing Director (MD) Selim RF Hussain and BAFEDA Chairman and Sonali Bank MD and Chief Executive Officer Md Afzal Karim led their respective organisations at the meeting.
“We set the rate to curb the uneven competition in the US dollar market,” BAFEDA Chairman Md Afzal Karim told journalists after the meeting.
“We discussed the present situation in the forex market and agreed to comply with those rates,” he added.
BAFEDA will revise the rate after five working days, the chairman said.
ABB Chairman Selim RF Hussain said that those rates will be fixed for the next couple of days and then will be changed from time to time.
“The central bank will help us to implement the rates, and will also guide us in this regard. Our main destination is making stability in the forex market,” he added.
Earlier on Thursday, Bangladesh Bank tasked ABB and BAFEDA to arrange a meeting about fixing the uniform exchange rate.
According to BAFEDA members, different banks are now quoting different rates while collecting US dollars from the foreign exchange houses and this is playing a role in creating instability in the forex market.
The foreign exchange market is still unstable as importers are now spending Tk 106-107 per dollar to pay their import bills, while the inter-bank exchange rate is Tk 95 per dollar.
State-run banks and small banks are not getting US dollars from the foreign exchange house because some large banks offer a higher rate to the foreign exchange house for collecting remittance, which pushed them to take initiative in setting a uniform exchange rate, as per industry insiders.
The volatility in the forex market ended up reducing the forex reserves of Bangladesh, which slid to $37.06 billion on Thursday, following the routine
payment worth $1.73 billion made to the Asian Clearing Union (ACU) against imports, a high official of the Bangladesh Bank confirmed.
The Foreign exchange reserves were $38.94 billion last Wednesday. Reserves hit the highest $48 billion in September last year, and are gradually decreasing due to the growing import payments.
