Bangladesh’s gross foreign exchange reserves have undergone a significant contraction, slipping below the $28 billion threshold following a mandatory regional settlement. The decline marks a sharp reversal from the nearly $1 billion growth recorded by the central bank during the preceding fortnight, highlighting the volatile nature of the country’s external account management.
The Mechanics of the Dip
On Thursday, 8 January 2026, Arif Hossain Khan, Executive Director and Spokesperson for Bangladesh Bank, confirmed that the nation had settled $1.53 billion in import bills through the Asian Clearing Union (ACU). This substantial outflow reduced the gross reserves to $27.85 billion, down from the $29.19 billion reported just 24 hours earlier.
The ACU, founded in 1974 under the auspices of the United Nations, functions as a multilateral payment gateway for nine member states, including India, Pakistan, and Iran. Because major trade liabilities are settled bimonthly, the central bank’s reserve figures typically experience a cyclical “sawtooth” pattern—rising through daily accumulations and dropping abruptly during settlement weeks.
Table: Recent Trajectory of Bangladesh’s Foreign Reserves
| Reporting Date | Reserve Level (BPM6) | Contextual Event |
| 22 December 2025 | $28.04 billion | Mid-month baseline |
| 06 January 2026 | $29.19 billion | Peak following $1.15bn growth |
| 08 January 2026 | $27.85 billion | Post-$1.53bn ACU Settlement |
| January 2026 (MTD) | +$411 million | Net USD purchased from banks |
A Strategy of Aggressive Accumulation
Despite the recent decline, the underlying trend suggests a deliberate effort by the central bank to shore up liquidity. During the first half of the 2025–26 fiscal year (July to January), Bangladesh Bank purchased a total of $3.54 billion from commercial banks.
A senior official noted that the “dollar crisis” in the private sector has eased significantly due to a robust increase in remittance inflows. To prevent the exchange rate from falling too low—which would disadvantage exporters and expatriates—the central bank has been absorbing excess dollars through auctions. In the first six days of January 2026 alone, the bank procured $411 million, demonstrating a commitment to rebuilding the “buffer” required to meet International Monetary Fund (IMF) benchmarks.
Long-term Implications
While the $27.85 billion figure represents a technical dip, market analysts suggest that the improved supply of greenbacks in the commercial banking sector is a positive indicator for economic stability. The challenge remains for the central bank to balance these mandatory external payments with the need to maintain a reserve level that ensures at least three months of import cover for the burgeoning economy.