A file photo shows people walking past the headquarters of the Bangladesh Bank at Motijheel in the capital. | Sony Ramani
Commercial banks’ holdings of dollars fell to $4.2 billion in November mainly due to the central bank’s aggressive dollar purchases and high import payments.
Bangladesh Bank data show that banks’ gross foreign exchange holdings reached to the current level in November, down from $4.38 billion in the same month a year earlier.
Although balances recovered slightly from $3.76 billion in October and $3.93 billion in September 2025, they remain well below the level of more than $6 billion recorded in July 2024, indicating a sustained squeeze on banks’ dollar liquidity.
Banker said that while remittance inflows and export earnings improved over the past year, banks had to sell a significant volume of dollars to the central bank and use the rest to settle rising import payments.
Since July 2025, Bangladesh Bank has purchased more than $3 billion from commercial banks through multiple-price auctions at rates ranging between Tk 121.5 and Tk 122.3 per dollar.
The central bank stepped up its intervention after the interbank rate slid to around Tk 119 in June, raising concerns about renewed volatility in the currency market.
Officials said that the purchases helped stabilise the exchange rate at around Tk 122 and restored confidence in the formal market, encouraging remittance flows through banks instead of informal channels.
Remittance inflows reached a record $30.32 billion in the last financial year, nearly 27 per cent higher than the previous year.
In the first half of the current fiscal year, inflows amounted to $16.26 billion, up more than 18 per cent year on year.
Monthly receipts have remained above $2 billion since August 2024, providing steady foreign exchange support to the economy.
Export earnings also improved on an annual basis. According to the Export Promotion Bureau, exports grew 8.6 per cent to $48.3 billion in FY25.
However, earnings in the July–December period of the current fiscal year slipped slightly to $23.99 billion compared with the same period a year earlier, suggesting that external demand remains uneven.
At the same time, import activity began to pick up as demand for essential goods increased.
Letters of credit worth $69 billion were opened in FY25, up from $66.7 billion a year earlier.
LC openings rose to $29.78 billion during July–November 2025 from $27.95 billion in the corresponding period of the previous year.
Bankers said the higher import bill, combined with the central bank’s dollar buying, further reduced banks’ foreign currency balances.
Many banks chose to sell dollars to the central bank as private investment demand remained weak and opportunities for overseas payments were limited.
Bankers also noted that the narrowing gap between official exchange rates and informal hundi rates reduced incentives to hold dollars, pushing more foreign currency into the banking system.
BB officials said the shift from selling to buying dollars has helped rebuild reserves.
As of January 15, 2026, foreign exchange reserves stood at $28 billion under IMF calculation standards, while the traditional measure placed reserves at $32.62 billion.