Greenback gets dearer for hot buys as big bugs go holidaying abroad

The US dollar rode high on a hot demand in the open market, known as 'kerb market', as the greenback has bagged abnormally high exchange rates since before Eid vacation.
Moneychangers attributed this fast buck simply to a high demand for the foreign currency as many flew abroad for vacationing on the occasion of Eid-ul-Fitr.
The dollar hit a new high just before the festival, claiming up to Tk 80.20, up by Tk 1.40 from the usual rate a week before the Eid vacation.
However, the high fly started taking a dive down Tuesday.
As of Tuesday, the dollar dropped to Tk 79.70, according to money-exchange companies in the city.
But the existing exchange rate is still much higher than that of inter-bank exchange rate.
The inter-bank exchange rate was Tk 77.80 on July 20, according to the central bank.
Inter-bank exchanges are determined by the dealer banks, based on demand-supply interaction.
The current exchange rate of the US currency (dollar) against the local currency, taka, is up by Tk 1.90 from the inter-bank exchange rate.
However, the exchange rates of other major currencies, such as euro, pound sterling and riyal, remained almost stable on the kerb market.
Owners of the money exchanges in the city said the demand for the greenback had increased significantly this time as hundreds of people are believed to have gone abroad and they required dollars to meet expenses in the foreign countries.
They said a large number of rich people enjoy foreign tours during Eid vacation--and this trend has been growing in recent times.
Many go for health checkups, many for mere amusement.
"Huge demand for the US dollar helped this currency to gain on the open currency market," said Golam Mostafa, president of Bangladesh Money Exchange Association, a group of around 60 money-exchange houses.
"They (visitors) prefer US dollars and for this reason the demand for the greenback rises on the money market," said Mr Mostafa,
A new trend is that a section of people with their family usually fly abroad to enjoy the long vacation of Eid, he noted.
Not only businesspeople, professionals from banks and well-structured local companies also fly to South and East Asian countries. Their holiday destinations include India, Nepal, Bhutan, Thailand, Malaysia, Pakistan and Singapore.
However, he said, "It's a temporary takeoff".
Money-exchange offices hinted that the rate would stabilise on the kerb market shortly.
Tafazzal Hossain, the proprietor of SMT Money Exchange in the city, said the supply of the dollar would start in full swing within the next couple of days and then its rate would stabilise.
He said: "The dollar was short in supply on the market, but we had to arrange this currency to meet requirements of people. For this reason, we raised the rate."
The exchange rate of the dollar normally also increases on the kerb market when substantial illegal transactions like smuggling and under- and over-invoicing take place, traders said.
However, there is no estimation as to how many dollars were sold over the past one week as the moneychangers submit their respective report to the central bank every 15 days.
However, the Bangladesh Bank has made a move to introduce online transaction that will ensure daily buy-sell figures.
The central bank will meet with the money-exchange houses on August 02 on the matter of trading in money.
    jaismharoon@yahoo.com