Dollar price on the rise
Inflow of remittance has witnessed a downtrend over the past three months. Export earnings have dropped below the target. Besides, import cost started increasing.
As a result, demand for dollar rose and Bangladesh Bank started selling it. So, price of the US currency against taka began to rise.
Sources said Bangladesh Bank had long kept price at Tk 84.80 a dollar. But, dollar price started increasing on 5 August due to surge in demand. Dollar price now rose to Tk 85.20.
Though beneficiaries of wage earners’ income and exports are happy over the rise in dollar price but pressure grows on importers.
Islami Bank Bangladesh Limited (IBBL) receives the highest amount of foreign currencies in the country.
IBBL managing director Mohammed Monirul Moula told Prothom Alo large amount of fertilizers is imported during this time of the year. Besides, other import cost increased and remittance also decreased too. As a result, dollar price started rising. But, it would become normal gradually, he added.
Bankers said import of food products including rice and lentil has increased. Besides, labour migration and communication with many countries including India have started. As a result, pressure falls on dollar and its price increased in banks and open markets.
Bangladesh Bank started selling dollars last month after banks faced scarcity of the currency. As of Tuesday, the central bank sold $500 million (50 crore) since August and mopped over Tk 42.5 billion (4225 crore) from banks.
Bangladesh Bank will continue sale of dollar to the banks to meet the demand and that may create pressure on reserve. Bankers, however, said rise in demand of dollar is temporary.
Asked on rise in demand for dollar, Agrani Bank managing director Mohammad Shams-Ul Islam told Prothom Alo, “Demand for import of machineries increased suddenly at cotton factories. Besides, both import and price of all kinds of raw materials including cotton and yarn has gone up. But dollar inflow is comparatively low. As a result price is rising.”
“Export will increase in future due to rise in import of machineries and raw materials. These indexes indicate economy is turning around despite the coronavirus pandemic,” he added.
Meanwhile, inflow of remittance has seen a downtrend since last June. Bankers fear it may drop further in coming days.
Remittance decreased by 8 per cent year-on-year to $1.81 billion (181 crore) or about Tk 153.85 billion (15,385 crore) in August. Expatriates sent $1.81 billion in August last year.
Likewise, export earnings also dropped by 31 per cent year-on-year in July-August this year.
Expenditure also increased though Inflow of foreign currency fell. Import expenses increased by 21.60 per cent year-on-year to $ 5.14 billion (514 crore) in July this year. Import cost was $4.22 billion (422 crore) in july last year.
*This report appeared in the print and online edition of Prothom Alo and has been rewritten in English by Hasanul Banna