Though the central bank asked banks not to sell the US dollar at rates higher than Tk 83.20 in November last year. But the BAFEDA has been forced to reset the rate because of a rising trend of inter-bank exchange rate in the recent months. Observers apprehend that this could create inflationary pressure and compress the foreign exchange reserves. Remittance inflow of $12.77 billion in the last fiscal year was the lowest in last six years. And for the first time in 15 years, Bangladesh’s apparel exports failed to register even single digit growth. On the other hand, import payments grew more than 9 percent last fiscal year.
Exports and inward remittances, the two major sources of foreign currency in Bangladesh, are on the decline while imports are rising, widening the current account deficit. But banks could gain profit from this when the gap between the buying and selling rate widens. As they provide foreign exchange services to their customers, including buying foreign currency from exporters and remitters and selling it on to importers.
Country like Bangladesh is majorly an importer of goods. No doubt, costlier imports will aid to enhance inflation and other spiral effects not conducive to economy growth. And also, it will impact the foreign currency reserves of the country. If the present trend continues, it will increase the deficit of the country in the long run.
