Taka continues to slide against USD

Taka is continuously depreciating against the American greenback thanks to the growing import payment, creating a burden on importers but boosting export and remittance earnings.

The inter-bank exchange rate stood at Tk 92 per dollar on Tuesday, up from Monday’s Tk 91.95, a senior Bangladesh Bank (BB) official confirmed to The Business Post.

On Tuesday, the central bank sold $129 million to banks at Tk 92 per dollar. The information will be updated on the BB’s website on Wednesday.

The inter-bank exchange rate has depreciated by Tk 2.10 per dollar this week alone, which has also been the highest depreciation in recent time.

This is the 11th depreciation of the taka against the US dollar this year so far.

However, importers are still spending over Tk 95 per dollar for import payments while banks are paying Tk 94-95 to mobilize US dollars from exporters and remitters, according to industry insiders.

On January 9, the local currency depreciated by 20 poisa to Tk 86 per dollar for the first time this year.

On June 2, the taka lost its value by 90 poisa to Tk 89.9 per dollar when the central bank allowed a floating exchange rate after backtracking on its earlier directive on a uniform exchange rate.

Before Tuesday, the inter-bank exchange rate went up to Tk 91.50 per USD on Monday, up from the previous Tk 89.9.

Due to the impacts of the Covid-19 and the Russia-Ukraine war, costs of product supply and delivery have gone up. As a result, Taka began losing its value like many other currencies in the world, due to the rising demand for US dollars.

Rising import payments played a key role as well behind the increase in the dollar’s demand.

During the July-April period of this fiscal year, Bangladesh’s trade deficit — the gap between the country’s export incomes and import expenditures — widened by 53 per cent, higher compared to the same period last year, as per BB data.

The country’s foreign exchange reserves also dropped to $41.9 billion on Monday from $42.1 billion on June 1 due to the dollar selling spree of the central bank, according to sources.