May remittances hit record high as expats boost wire before Eid

The inflow of remittances reached US$1.75 billion in May ahead of the upcoming Eid-ul-Fitr festival, highest ever the country received in a month, officials said.
The remittance inflow was estimated at $1.75 billion in May, up by 321.72 million the month before. The amount was $1.50 billion in May 2018.
"The May remittance set a new record in the history of Bangladesh," Kazi Sayedur Rahman, executive director of the Bangladesh Bank (BB), told the FE Monday.
Non-resident Bangladeshis (NRBs) normally send increased amount of remittances to help the relatives and families left behind celebrate the Muslims' Eid-ul-Fitr festival. The festival is expected to be celebrated tomorrow (Wednesday), subject to the appearance of the moon.
Mr. Rahman, who oversees the Forex Reserve & Treasury Management Department of the central bank, said such a higher inflow of remittance leaves a positive impact on the existing flexible exchange rate policy.
"The exchange rate of Bangladesh Taka (BDT) against the US currency in the banking channel is almost equal to the kerb market," the central banker explained.
Senior bankers, however, said the flow of inward remittance showed an upward trend in recent months due to the depreciation of the local currency against the US currency.
The higher demand of the greenback for settling the import bills caused the depreciation.
The local currency depreciated by 60 poisha against the greenback in the inter-bank forex market from January 03 to May 06.
The greenback was quoted at Tk 84.50 each in the market on May 06 against Tk 83.90 on January 02 this calendar year, according to market operators.
It also remained unchanged at Tk 84.50 Monday.
Strengthening the central bank's surveillance to check hundi, the illegal channel used to move funds across borders, has helped increase the flow of inward remittances, Mr. Rahman explained.
Meanwhile, the inflow of remittance grew by nearly 11 per cent or $1.46 billion to $15.06 billion during the July-May period of the fiscal year (FY), 2018-19 from $13.60 billion in the same period of the previous fiscal, the BB data showed.
Currently, 29 Bangladeshi exchange houses are operating across the world along with more than 1,200 drawing arrangements abroad to boost the remittance inflow, according to BB officials.
Taking to the FE, a senior executive of a leading Shariah-based private commercial bank said, "The inflow of remittance may fall this month. But it will increase again in July."
Official channel is becoming popular among the people of remote areas across the country as some banks extend their services through setting up agent banking, the private banker noted.
He also said better exchange rate has also encouraged expatriate Bangladeshis to send their hard-earned money through the formal banking channel instead of illegal "hundi" system to help boost the country's foreign exchange reserve.
The country's forex reserve rose to $31.40 Monday from $31. 34 billion of the previous working day, despite $20 million sold to two state-owned commercial banks for making import payment bills against petroleum products.

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