Bangladesh forex reserves cross $30bn again

Due to the clearing of $1.18 billion in import payments through the Asian Clearing Union (ACU) mechanism, Bangladesh Bank‍‍`s foreign exchange reserves have once more risen to $30.36 billion from $29.78 billion just a day earlier.

According to Md Mezbaul Haque, executive director of the Bangladesh Bank, the increase occurred after the nation got a $507 million loan from the World Bank for financial help.

"We have asked for financial support from numerous international organizations, and the World Bank has already provided it," he said.

"We continue to have faith that the remaining organizations will provide us with funds soon," he added. 

If Bangladesh Bank receives the anticipated fund, the nation‍‍`s reserves will exceed $32 billion by the end of June, according to Haque.

Taking into account the International Monetary Fund‍‍`s (IMF) conditions, the country‍‍`s net international reserve (NIR) will be sufficient by June, he added.

In March, the IMF set a floor for Bangladesh to maintain a net international reserve of $22.94 billion, a target the nation failed to achieve.

For June, the IMF has imposed a condition to raise this floor to $24.46 billion.

For September, the IMF has stipulated a net international reserve of $25.31 billion, and $26.411 billion for December.

The Economic Relations Division (ERD) is working to acquire the $400 million in financial support from the Asian Infrastructure Investment Bank, $320 million from the Japan International Cooperation Agency (Jica), and $100 million from South Korea by the end of June.

By June, the reserves will have increased by $1 billion if these loans can be obtained.

The gross foreign exchange reserves hit a record high of $48 billion in August 2021 when BB began infusing dollars into the foreign exchange market in response to bank shortages brought on by rising import payments, which were sparked by the recovery of the economy from the Covid-19 crisis.

When the Russia-Ukraine war broke out in February 2022, the forex crisis got worse and greatly hampered the world‍‍`s supply chain.