Central Bank Expands Dollar Reserves with Fresh Auction

Bangladesh Bank has continued its active intervention in the foreign exchange market by purchasing an additional USD 60 million through an auction mechanism, underscoring its ongoing efforts to manage liquidity and stabilise the country’s foreign exchange reserves. The latest transaction was completed on Sunday, 21 December, through bids submitted by four commercial banks, according to an official statement.

The information was confirmed by Arif Hossain Khan, Executive Director and spokesperson of Bangladesh Bank, who stated that the central bank bought the dollars at an exchange rate of Tk 122.30 per US dollar. The same rate was set as the cut-off price for the auction, indicating uniform pricing across accepted bids.

With this latest purchase, Bangladesh Bank’s total dollar acquisition for the current month of December has reached USD 805.50 million, equivalent to approximately USD 805.55 million. The sizeable volume reflects a sustained policy approach aimed at absorbing excess dollars from the market at a time when remittance inflows and export earnings have shown relative strength.

Officials noted that the central bank has been using auctions as a preferred instrument to ensure transparency and market-based price discovery in foreign currency transactions. By purchasing dollars through competitive bidding, Bangladesh Bank seeks to balance exchange rate flexibility with its broader objective of maintaining macroeconomic stability.

The current buying spree is not limited to December alone. Since the beginning of the ongoing 2025–26 fiscal year, Bangladesh Bank has conducted multiple rounds of dollar purchases through auctions. Cumulatively, the central bank has so far bought USD 2.93 billion, or approximately USD 2.9315 billion, during this fiscal period. Analysts believe this reflects a strategic effort to rebuild and strengthen foreign exchange reserves after previous periods of pressure caused by rising import bills and external payment obligations.

Market participants have observed that the central bank’s consistent presence in the dollar market has helped prevent excessive volatility in the exchange rate. While the taka remains under pressure due to global economic uncertainties and higher commodity prices, regular dollar purchases at market-aligned rates have contributed to greater predictability for banks, importers, and exporters alike.

Economists also point out that such interventions allow the central bank to sterilise surplus liquidity in the banking system, thereby supporting monetary policy objectives, including inflation management. However, they caution that continued purchases will need to be carefully calibrated to avoid unintended impacts on domestic money supply.

Bangladesh Bank reiterated that it will continue to monitor market conditions closely and adjust its foreign exchange operations as required, in line with its mandate to ensure financial stability and orderly market functioning.

Summary of Recent Dollar Purchases by Bangladesh Bank

The continued dollar acquisitions highlight Bangladesh Bank’s proactive stance in navigating external sector challenges while reinforcing confidence in the country’s foreign exchange market.