Dollar price high on hot demand

The US dollar became much costlier on Dhaka's informal money market amid higher demand, selling between Tk 84.20 and Tk 85.
Traders and customers said the exchange rate of the greenback against the Bangladesh currency increased rather faster, as the rate was around Tk 82.50 on the kerb market three weeks back.
The demand for the newly circulated American currency note of 100 denominations is quite high amid low availability, which further pushed up price of the note.
Traders claimed growing numbers of outbound trips during this peak season of celebrating Christmas and the upcoming New Year for 2018 put a pressure on the supply, causing the price prancing.
But the customers turned down the claim, saying that it is a common practice of the traders to gain extra in the name of supply shortfalls.
During visits to several currency-changing outlets in the capital's Motijheel, Paltan and Shahbagh areas Tuesday, the dollar-searching customers were seen bargaining with exchange houses over the enhanced rate.
Md. Sattar Mia of Times Money Exchanger told the FE that the selling price of the dollar, especially the new 100-denomination note that has huge demand, continued to climb because of insufficient supply.
"We're also buying dollars at higher rates. The price might increase further in the coming days as the demand is mounting," he said, indicating further volatility on the foreign-exchange market.
He said increased numbers of customers are willing to travel outside Bangladesh to celebrate New Year while many people want to make foreign trips on medical purposes and they came to buy new currency notes of 100 denominations because the US central bank wants to take back the old currency notes.
"But we have not enough supply and the situation was almost same to other exchangers," he said.
Talking to the FE, Mohammad Ekramul Islam, who plans to go to India for medical purpose, said he came to the money-exchange house (Pioneer Money Changer) to buy dollars but the exchange house demanded a much higher rate.
"It is a common practice of the moneychangers like other traders to gain extra in the name of supply shortage. I'm sure they have enough stock but they have unethical intention that was the reason," he said on a note of frustration.
Mr. Islam also said he went to NCC Bank's Motijheel branch, who offered him Tk 83.73 per dollar as selling price, which is a comparatively low rate.
Admitting the supply shortage and higher rate of the dollar, Mohammad Liton Mia of Pioneer Money Changer said the rate in the commercial banks is almost same or sometimes higher than that of the exchange houses as they (banks) include VAT and other charges.
"But many customers don't understand the fact," he added.
However, the dollar price in the commercial banks continued to shoot up and the selling rate of the greenback stood at Tk 83.75 on the day while the rate was Tk 80.90 early last month. People in the business mentioned higher imports as reason for the hike in dollar's exchange rates.

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