[🇧🇩] Monitoring Bangladesh's Economy

[Saif]

Forex market steadies as dollar inflows go up

The country’s foreign exchange market is stabilising thanks to a surge in US dollar (USD) inflows, driven by higher remittances, stronger export earnings and tighter oversight by the central bank.

www.thedailystar.net

Forex market steadies as dollar inflows go up

The country's foreign exchange market is stabilising thanks to a surge in US dollar (USD) inflows, driven by higher remittances, stronger export earnings and tighter oversight by the central bank.

Liquidity in the forex market has improved, evident in banks' net open positions (NOP) -- the difference between their foreign currency assets and liabilities.

Banks' NOP reached $550 million as of 20 March, up from around $150 million earlier in the month, according to Bangladesh Bank data.

Over the past few months, the NOP had fluctuated between $250 million and $300 million, central bank officials said.

Industry insiders attributed the NOP increase to a rise in the inflow of the US dollar, which indicates that the foreign exchange market is increasingly gaining stability.

Bankers say remittances started to climb following the political changeover in August last year, while export growth further bolstered foreign exchange reserves.

"The forex market has stabilised in recent months due to higher dollar inflows," said Mirza Elias Uddin Ahmed, managing director and CEO of Jamuna Bank.

"Remittances have played a key role in boosting USD availability," said Ahmed.

In the first 23 days of March, remittances hit a record $2.63 billion ahead of Eid-ul-Fitr, the biggest religious festival for Muslims.

Industry insiders anticipate that the figure could reach $3 billion by the end of March -- an all-time high.

The upward trend in remittances began after the political changeover in August last year.

In September, remittances jumped 80.28 percent year-on-year to $2.4 billion, central bank data shows.

The momentum continued, with inflows of $2.39 billion in October, $2.19 billion in November, $2.63 billion in December, $2.18 billion in January and $2.52 billion in February.

According to Jamuna Bank CEO Ahmed, demand for hundi and hawala, illegal cross-border transfer systems, have dropped since authorities cracked down on those involved after the changeover. This has further funnelled remittances through formal banking channels.

"Stricter central bank monitoring has also curbed speculative trading, helping steady the market," he added.

Meanwhile, export earnings rose by 2.77 percent to $3.97 billion in February, according to the Export Promotion Bureau (EPB).

Foreign exchange reserves now stand at $20.01 billion, based on the International Monetary Fund (IMF) calculations.

The interbank exchange rate remains pegged at Tk 122 per USD -- an unofficial central bank directive.

"While banks quote rates around this midpoint, forward transactions often exceed it," Ahmed explained.

Apart from the forex market, the local currency market remains stable despite the Eid rush, according to central bank officials.

They said that except for some weak and troubled banks, the majority of banks now have excess liquidity despite significant cash withdrawal pressure ahead of the Eid festival.

The overnight call money rate, the interest on short-term interbank loans, fell to 9.95 percent on 25 March from over 10 percent a month earlier, according to central bank data, as liquidity demand eased.​

 

[Saif]

Next ADP likely to be worth Tk 2.30t

A relatively fat development budget worth Tk 2.30 trillion is likely to be prepared for the next fiscal year, too, by the interim government notwithstanding a staggeringly low execution of the outgoing ADP. By official count, only a fourth of the total annual de

thefinancialexpress.com.bd

Next ADP likely to be worth Tk 2.30t
Ought to be pruned suiting financing trend: Dr Zahid
Syful Islam
Published :
Mar 26, 2025 23:54
Updated :
Mar 26, 2025 23:54

A relatively fat development budget worth Tk 2.30 trillion is likely to be prepared for the next fiscal year, too, by the interim government notwithstanding a staggeringly low execution of the outgoing ADP.

By official count, only a fourth of the total annual development programme or ADP for the fiscal year 2024-25 had been implemented in eight months to this February. Also, its size underwent a significant pruning.

The size of the ADP in the upcoming financial year may set at Tk 2.30 trillion to meet fund demands made by different ministries and divisions, finance ministry officials said.

However, the finance officials find the new ADP outsized compared to the implementation capacity of the ministries and presume that it will also remain largely unimplemented.

The original ADP allocation for the outgoing fiscal year 2024-25 was Tk 2.65 trillion which was revised down by Tk 49 billion to Tk 2.16 trillion earlier this month following a big implementation gap.

Data show that the ADP-execution rate during the July-February period of FY25 was 24.27 per cent, 6.91-percentage-point lower than that of the same period of the past fiscal year.

The spending happens to be lowest in last 14 years, which reflects the agencies' inabilities to improve up their under-par implementation abilities.

In the same period in the previous fiscal year, the ADP-execution rate was 31.18 per cent of the total allocation, data available with the Implementation Monitoring and Evaluation Division (IMED) show.

Officials see political instability from the very beginning of the current fiscal year and an "inactive" administration following regime change as drags behind the slow implementation of the development programme.

They fear that this fiscal's ADP implementation could be one of the lowest in the country's history and the agencies may fail to spend the entire funds given to them in the revised ADP, too.

Finance Division secretary Dr Khairuzzaman Mozumder Tuesday said proposals were there to remove the less-important projects and that the government was now doing the trimming.

He aid the ADP came down from Tk 2.65 trillion to Tk 2.16 trillion in the revised budget. "Even then, there is still a lot of money which the ministries and divisions are unable to expend."

Dr Zahid Hussain, a former lead economist at World Bank's Dhaka office, thinks Tk 2.30-trillion ADP for next fiscal year will be big one considering the implementation capacity of the agencies and the trend in government revenue earnings.

"Had the government succeeded in enhancing foreign financing, the size of ADP could have been increased by raising budget deficit," he told The Financial Express.

Mr Hussain attributes low disbursement of foreign aid to non-functional administration -- evidently under the hangover of uncertainty following the turbulence associated with the changeover.

"There is US$45 billion in the pipeline but how much the implementation capacity can be increased in a year?" he asks.

The economist feels that the government needs to further lower the size of the next ADP through "considering the financing trend".​

 

[Saif]

Remittances near record $3 billion in March

The inflow was 82.46 percent higher than the same period last year, according to industry insiders.

www.thedailystar.net

Remittances near record $3 billion in March

Bangladesh received a record $2.94 billion in remittances in the first 26 days of March, driven by Eid-ul-Fitr, one of the biggest festivals for Muslims.

The inflow was 82.46 percent higher than the same period last year, according to industry insiders.

Remittance receipts are expected to surpass $3 billion by the end of the month, marking a historic high for a single month.

Apart from the Eid-related surge, the demand for hundi and hawala—illegal cross-border money transfer channels—has declined following a crackdown on operators after the political changeover, said Mirza Elias Uddin Ahmed, managing director and CEO of Jamuna Bank.

This has diverted more remittances through formal banking channels, he added.​

 

[Saif]

Forex reserve crosses $25 billion

The forex reserve in the country has crossed US $25 billion before the Eid-ul-Fitr as it was boosted by the record $2.95 billion remittance income in the first 26 days of this March. Bangladesh Bank deputy director Mohammad Ibrahim Munshi confirmed this.

en.prothomalo.com

Forex reserve crosses $25 billion
Staff Correspondent
Dhaka
Published: 28 Mar 2025, 20: 27

Dollar File photo

The forex reserve in the country has crossed US $25 billion before the Eid-ul-Fitr as it was boosted by the record $2.95 billion remittance income in the first 26 days of this March.

Bangladesh Bank deputy director Mohammad Ibrahim Munshi confirmed this.

According to the central bank, the reserve was $25.44 billion on Thursday. On the other hand, as per the calculation done using BPM-6, following the requirement of the International Monetary Fund, the amount of reserve was $20.29 billion.

The Bangladesh Bank paid $1.75 billion import bills of January and February on 9 March through Asian Clearing Union (ACU).

As a result, the actual reserve had fallen to $19.75 billion. But within just 20 days, the reserve amount increased, thanks to the remittance and export incomes.​

 

[Saif]

Bangladesh, Pakistan, and Sri Lanka sign deal to strengthen capital markets

The agreement, signed on Thursday in Colombo, aims to facilitate technology development and sharing

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Bangladesh, Pakistan, and Sri Lanka sign deal to strengthen capital markets

Photo: DSE

The Dhaka Stock Exchange (DSE), Pakistan Stock Exchange (PSX), and Colombo Stock Exchange (CSE) have signed a tripartite memorandum of understanding (MoU) to enhance cooperation among the three bourses.

The agreement, signed on Thursday in Colombo, aims to facilitate technology development and sharing, human resource collaboration, product development, regulatory coordination, investor protection, and knowledge exchange across the markets, according to a press release issued by the DSE yesterday.

The signing ceremony was attended by DSE Chairman Mominul Islam, CSE Chairman Dilshan Wirasekara, and Securities and Exchange Commission of Pakistan Chairman Akif Saeed, along with directors and senior officials from the respective institutions.

DSE Chairman Mominul Islam said, "South Asian stock exchanges—except for India—face technological and operational constraints due to their relatively small size. These limitations prevent markets with immense potential from reaching their full capacity."

"Through mutual experience-sharing and joint investments in technology, our stock exchanges can play an effective role in developing strong and efficient capital markets in their respective countries," he added.

As part of the event, the DSE chairman participated in a panel discussion titled "Navigating Frontier Capital Markets: How Evolving Market Regulation and Exchanges Foster Efficient Capital Market Development."

DSE representatives also held separate meetings with the chairman and commissioners of the Securities and Exchange Commission of Pakistan, senior executives of PSX, and officials from CSE.​