BB buys $67m more to stabilise forex mkt

The central bank purchased a further US$67 million through auction from seven banks in the interbank spot market on Wednesday, aiming to stabilise the exchange rate of the US dollar against the local currency.

The amount was bought under the Multiple Price Auction method, with a cut-off rate of Tk 122.30 per dollar, according to central bank officials.

Bangladesh Bank (BB) has so far purchased $2.87 billion directly from commercial banks since July 13 under the prevailing free-floating exchange rate arrangement, the central bank's latest data show.

"We are purchasing US dollars from commercial banks to keep the exchange rate stable, which in turn supports export earnings and remittance inflows," a senior Bangladesh Bank official told The Financial Express, explaining the central bank's intervention in the foreign exchange (forex) market.

The official said the liquidity position of some banks, including troubled ones, has improved as a result of selling their US dollars to the central bank.

He added that such interventions are also helping to strengthen the country's foreign exchange reserves.

Meanwhile, Bangladesh's gross forex reserves rose to $32.48 billion on December 17 from $32.12 billion on December 11, according to the central bank's traditional accounting method.

Under the International Monetary Fund's Balance of Payments and International Investment Position Manual, sixth edition (BPM6), the country's forex reserves stood at $27.82 billion during the period under review, up from $27.45 billion, Bangladesh Bank data showed.

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