BB asks exporters to be careful while making deals with buyers
Tuesday, 28 October 2008
FE Report
The central bank has cautioned the country's exporters to be careful about any deal with their buyers to avert any risks in view of the ongoing global financial crisis.
"There is a recent tendency that importers place huge orders when they reach the verge of bankruptcy. So, the exporters particularly in the readymade garment (RMG) sector must remain alert," Bangladesh Bank (BB) Governor Salehuddin Ahmed told reporters at a press conference at the central bank Monday.
Mentioning the East Asian crisis in 1997, the central bank chief said importers of the Western world may place huge orders before reaching possible bankruptcy. "It's a technique that was resorted to during the Asian crisis," he added.
The BB Governor also said the RMG exporters should examine the financial position along with rating reports of importers concerned when they place increasing orders for shipments.
Besides, the central bank is watching closely the currencies movement of different countries including the competitors of Bangladesh in the global market, the central bank Governor said.
But he ruled out depreciation of the local currency against the US dollar at this moment saying that Bangladesh taka (BDT) was depreciated against US dollar marginally in line with the market demand.
"We're now monitoring currencies' movement closely. But the central bank will not take any hurried measures in this connection," Mr. Ahmed said.
In the last week, BDT was devalued marginally by 0.06 per cent against US dollar as the demand for greenback increased in the market.
The exchange rate of dollar hovered between Tk 68.52 and Tk 68.58 in the inter-bank foreign exchange market against the previous week's single rate of Tk 68.52, market operators said.
The BB Governor recognised that the currencies in most of the countries other than China had been depreciated, but said the BDT remained stable for quite a long time that helped reduce the import cost of the country.
He also said the central bank will review the lending rate further in line with the existing market indications that inflation has already eased to some extent and would come down in the near future.
Supplementing the BB Governor, Deputy Governor Ziaul Hassan Siddiqui said the inflation will ease further by the end of this year as there has been a falling trend in the prices of essential commodities in the global market as well as bumper Boro harvest and a better outlook for Aman this season.
The country's Consumers Price Index (CPI) inflation rose to 10.01 per cent in August this year on annual average basis from 10 per cent of the previous month.
The central bank has cautioned the country's exporters to be careful about any deal with their buyers to avert any risks in view of the ongoing global financial crisis.
"There is a recent tendency that importers place huge orders when they reach the verge of bankruptcy. So, the exporters particularly in the readymade garment (RMG) sector must remain alert," Bangladesh Bank (BB) Governor Salehuddin Ahmed told reporters at a press conference at the central bank Monday.
Mentioning the East Asian crisis in 1997, the central bank chief said importers of the Western world may place huge orders before reaching possible bankruptcy. "It's a technique that was resorted to during the Asian crisis," he added.
The BB Governor also said the RMG exporters should examine the financial position along with rating reports of importers concerned when they place increasing orders for shipments.
Besides, the central bank is watching closely the currencies movement of different countries including the competitors of Bangladesh in the global market, the central bank Governor said.
But he ruled out depreciation of the local currency against the US dollar at this moment saying that Bangladesh taka (BDT) was depreciated against US dollar marginally in line with the market demand.
"We're now monitoring currencies' movement closely. But the central bank will not take any hurried measures in this connection," Mr. Ahmed said.
In the last week, BDT was devalued marginally by 0.06 per cent against US dollar as the demand for greenback increased in the market.
The exchange rate of dollar hovered between Tk 68.52 and Tk 68.58 in the inter-bank foreign exchange market against the previous week's single rate of Tk 68.52, market operators said.
The BB Governor recognised that the currencies in most of the countries other than China had been depreciated, but said the BDT remained stable for quite a long time that helped reduce the import cost of the country.
He also said the central bank will review the lending rate further in line with the existing market indications that inflation has already eased to some extent and would come down in the near future.
Supplementing the BB Governor, Deputy Governor Ziaul Hassan Siddiqui said the inflation will ease further by the end of this year as there has been a falling trend in the prices of essential commodities in the global market as well as bumper Boro harvest and a better outlook for Aman this season.
The country's Consumers Price Index (CPI) inflation rose to 10.01 per cent in August this year on annual average basis from 10 per cent of the previous month.