Forex reserve dips to 6-year low

The foreign exchange reserves plunged to USD 31 billion as the government paid USD 1.05 billion in trade bills to the Asian Clearing Union (ACU) on Tuesday.

But the actual reserves would be USD 23 billion after deducting an already used amount of USD 8 billion.

It is the country’s lowest forex reserves since January 2017 when the figure crossed the USD 31 billion-mark for the first time.

The forex reserves were at USD 32.33 billion on 28 February. It had increased to an all time high at USD 48 billion in August 2021.

The reserves began to fall last year when the demand for dollars increased and the central bank offloaded the greenback frequently to settle the import bills. Its exchange rate against the local currency also soared from Tk 85 to Tk 108.

The ACU is an intra-regional payment gateway, involving Bangladesh, India, Iran, Nepal, Pakistan, Sri Lanka, Myanmar, Bhutan and Maldives. The bills of import-export trade among these nine countries are settled through the gateway after every two months.

However, Sri Lanka was excluded from the payment system after it failed to pay the bills.