A hope-raising rise in commercial banks' foreign-exchange holdings ebbed to US$5.25 billion in August, when the economy navigated a changeover in state power.
Officials and bankers have said the overall economic activities were upended in the first half of the eventful month of August because of student-citizen protests that led to the fall of immediate-past Prime Minister Sheikh Hasina's government.
As a matter of fact, the inflow of foreign currencies or forex almost came to a grinding halt for several days in the past month, which was reflected in the official data on forex-holding situation in banks, according to them.
Official data conflated by Bangladesh Bank (BB), the country's central bank, showed that the gross foreign exchange held by commercial banks stood at $5.25 billion in August in a fall of around 15 per cent from $6.09 billion a month before.
In the previous few months their forex positions were on the up and up: March accounting for $5.44 billion, April $5.05 billion, May $5.05 billion and June $6.10 billion.
On a year-on-year (YoY) basis, the August count of forex holdings in banks declined by 10 per cent from $5.81 billion recorded a year ago.
Speaking on condition of anonymity, a BB official said the economy went through a critical time in August, which could be a major reason for the fall in the forex stock in banks.
The official mentions that the central bank, as part of its reserves-boosting interventions, enhanced the band of the crawling peg, which allows fluctuations of the exchange rate within a predefined range, to 2.5 per cent from 1.0 per cent.
"It is helping attract more remittance," the central banker said, to dispel any concern about the country's foreign-exchange coffers.
On the other hand, the BB official added, the central bank skipped selling forex from its reserves while multilateral lending agencies committed to providing a significant volume of forex supports in the coming days.
"So, there will be no problem regarding the supply of forex, particularly the American greenback, in the coming days," the official assures.
Managing director and chief executive officer of Mutual Trust Bank (MTB) Syed Mahbubur Rahman says the inflow of remittance was almost shut in the first several days of August because of uprising.
"This could be a reason behind the fall in forex-holding data. But one-month data is not enough to understand a trend. We need at least three months' data to understand the situation," he told the FE.
On a note of optimism, the experienced banker says the forex situation seems to be improving riding on an impressive growth in remittance in recent days while more forex is expected to be coming from various global lending agencies in next few months.
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