Economy Desk: After settlement of the payment of 105 million dollars as a liability to the Asian Clearing Union (ACU), Bangladesh’s reserves stood at 31.15 billion dollars on Tuesday (March 7). Last Monday (March 6), reserves were 32.22 billion dollars. Reserves were around $44 billion a year ago. The central bank has already taken various initiatives to prevent the decline. Already, about $470 million of the first installment of the IMF has been added to the reserve.
Aku is an international transaction settlement system. Through this, transactions between Bangladesh, Bhutan, India, Iran, the Maldives, Myanmar, Nepal, and Pakistan are settled. Sri Lanka withdrew from Aku last October due to poor conditions. The rest of the countries settle their debts every two months. Last January, Akamai paid $1.12 billion. The most recent payment of $224 million was in May last year.
According to Bangladesh Bank data, reserves crossed the $48 billion mark for the first time in the country’s history in August 2021. However, due to the increase in global demand after Corona and the impact of the Russia-Ukraine war, the amount of foreign exchange coming into the country is greater than what is being spent. The central bank is constantly selling dollars from the foreign exchange reserves to meet the increased demand. This means that the reserve is continuously decreasing.
Bangladesh Bank has sold more than 10 billion dollars so far this fiscal year. Last fiscal year, sales were 7.62 billion dollars. In this way, through the sale of dollars, money is coming from the market to the central bank. This has created pressure on the liquidity of the money in addition to reducing the reserves. To improve this situation, the government and the central bank have taken initiatives to reduce the import liability.
Imports have decreased slightly due to various initiatives. Due to this, the trade deficit decreased by about 5.5 billion dollars to 13.39 billion dollars in the seven months of the current financial year until January. The current account deficit has come down to $5 billion. However, the overall deficit has increased three and a half times to 7.39 billion dollars due to the large deficit in terms of finances.
