Public dependency on the open market for US dollars has increased, where per dollar is being sold at Tk 120-121. The dollar crisis in the kerb market became more acute after Bangladesh Bank and law enforcers raided money changers with allegations of higher exchange rates. In this situation, a number of individuals are selling dollars, through their networks, at Tk 120-121 per dollar. They are becoming the lone source of dollars for those who are traveling abroad for treatment, education, and other emergencies, sources said. Read: Bangladesh Bank introduces dollar booking policy for max 1 year  Jamal (not his real name), owner of a money exchange house in Dhaka’s Motijheel area, told UNB today that they cannot buy a dollar even at Tk 115. “How can we possibly sell per dollar at Tk 113.30?” — he asked. Many other money changers and individual floating traders of the US dollar remain idle due to the supply crisis of the currency. In the span of a month, the exchange rate of the US dollar in the kerb (open) market reached Tk 120-121 per dollar from Tk 112. The central bank and law enforcers recently raided money changers and asked to sell per dollar at the previous rate of Tk 113.30. Read: Selling dollars at higher prices: What is Bangladesh Bank’s action against treasury heads of 10 banks? Market insiders said there is a severe shortage of US dollars in Bangladesh. The price of foreign currency is increasing uncontrollably and the value of taka is falling. As a result, the price of the dollar in the kerb market has crossed Tk 120. Talking to various exchange houses and those involved in dollar trading, UNB learnt that most money changers do not have dollars. Secretary General of the Money Changers Association of Bangladesh, Sheikh Helal Sikder, said that Bangladesh Bank has set the dollar price for money changers. In this case, the buying rate is Tk 111.80 and the selling rate is Tk 113.30. Read: Dollar goes off kerb market after central bank-led raids of money exchanges “No one is getting dollars at this price, so the money changers are now sitting empty-handed,” he said. Replying to a query about the dollar shortage in the kerb market, Bangladesh Bank’s Executive Director and spokesperson, Mesbaul Hoque, told UNB that dollars are being traded, but not everyone is selling them.

Bangladeshi businesses cannot use Indian rupee for foreign trade as Bangladesh Bank is yet to enlist the currency to settle letters of credit (LCs). BB spokesperson and executive director Md Serajul Islam told UNB that the central bank is yet enlisted Rupee for foreign trade. He said that Bangladesh Bank is reviewing currency diversification in foreign trade to reduce sole dependence on the US dollar. Read:“Use rupee, taka”: India asks exporters to refrain from trading in dollars with Bangladesh Before allowing any foreign currency for trading, the central bank has maintained an exchange stander, and stability in line with the IMF standard, he said. Businesses said if trade between Bangladesh and India happen in local currencies, pressure from falling US dollar reserves and associated ongoing forex market instability can be reduced. They said India is the second largest source of imports of raw materials and other goods for Bangladesh. Industrial raw materials, capital machinery, cotton, yarn, fabrics, and chemicals worth USD 16.19 billion were imported from India in the fiscal year 2021-22. Read:Bangladesh’s forex reserves now $36.90 billion At the same time, Bangladesh exported goods worth USD2 billion to the neighbouring country. On September 15, Bangladesh Bank allowed banks to open accounts in the Chinese currency yuan. IMF has recognized five countries’ currencies as “high-value”. The Chinese yuan was admitted to IMF’s high-value currency basket in 2016. Since then, the yuan has become stronger than ever as per a currency review by the IMF. Read Sri Lanka hopes to reach initial agreement with IMF for help

Bangladesh received a record $8.41 billion in foreign loans in 11 months of current FY2021-22, the Economic Relations Division said on Thursday. At current exchange rate the amount is equivalent to Tk 78221 crore, the highest loan ever in a single fiscal year. The amount is 47 per cent higher than the previous fiscal year. The ERD officials estimate that the foreign debt will exceed $9 billion by the end of the fiscal year on June 30, 2022. After the economic crisis in Sri Lanka, there is a lot of talk about Bangladesh's foreign debt. Also read: Default loans cross over 126 crore: Finance Minister However, economists and analysts are dismissing the comparison between the two countries. They say foreign debt is still below 13 per cent of Bangladesh's GDP. In case of Sri Lanka, it is close to 50 per cent. Economist and researcher Ahsan H. Mansur said, "The leap has been made by receiving more loans than expected from various donor countries and organizations, including the World Bank and the ADB, to offset the effects of the two-year pandemic." Analysis of ERD data shows that in the last FY2020-21, Bangladesh received $7.10 loan assistance from development partners. Before that, in the fiscal year 2019-20, Bangladesh received $7.38 billion foreign loan that was the history of the country till FY 21. Also read: FBCCI seeks loan moratorium till December Foreign debt has been increasing in Bangladesh since the fiscal year 2017-18. In the same year, it jumped to $6.37 billion. Then in the fiscal year 2018-19 it stood at Tk6.54 billion.

Bangladesh Bank (BB) has depreciated the local currency again by Tk0.90 to re-set the exchange rate at Tk 89.90 per US dollar.  Thursday’s devaluation of taka – the eighth this year - sought to discourage unnecessary imports amid global price hike of commodities.  Md Serajul Islam, executive director and spokesperson of BB told UNB that though the new exchange rate was not formally conveyed to banks, the BB sold $135 million to banks at the rate of Tk89.90. READ: Taka weakens further as BB sets new single exchange rate of USD at Tk89 The BB has resorted to frequent depreciation of Bangladesh currency to stabilize the restive foreign exchange trade.   Earlier the BB depreciated local currency by Tk0.25 to Tk0.40. But the central bank has recently increased the percentage of the devaluation.