Bangladesh’s foreign exchange reserves have surged past the $34 billion mark just days ahead of the thirteenth national parliamentary elections and concurrent referendums scheduled for 12 February. Economists and policymakers consider this a key indicator of economic stability during a politically sensitive period.
Arif Hossain Khan, Executive Director and spokesperson of Bangladesh Bank, stated on Monday, 9 February, that the growth in expatriate remittances has been the primary driver behind this increase. According to the latest figures, the country’s gross reserves now stand at $34.06 billion, while the reserves measured under the International Monetary Fund’s BPM6 methodology are $29.48 billion.
Remittances from overseas workers have played a pivotal role. In January alone, Bangladeshi expatriates remitted approximately $3.17 billion to the country. The inflow continued into February, surpassing $1 billion within the first eight days of the month. These inflows, combined with commercial banks’ excess dollar sales and the central bank’s strategic purchase activities, have contributed to the reserve build-up.
To maintain exchange rate stability and ensure a balanced demand-supply scenario in the market, Bangladesh Bank continues to purchase dollars from commercial banks. On Monday, 19 banks sold $209 million to the central bank through a multiple price auction (MPA) mechanism, with both the exchange rate and cut-off rate fixed at BDT 122.30 per dollar.
Central Bank Dollar Purchases (Fiscal Year-wise)
| Fiscal Year | Dollar Purchases from Banks (Billion USD) | Impact on Reserves |
|---|---|---|
| 2025–26 (current) | 4.73 | Continuous increase |
| 2023–24 | 1.00 | Maintained market stability |
| 2022–23 | 1.00 | Preserved reserve levels |
| 2021–22 | 1.00 | Limited effect |
Over the past three fiscal years, Bangladesh Bank has sold nearly $34 billion in total, including $7.6 billion in 2021–22, $13.5 billion in 2022–23, and $12.79 billion in 2023–24, while purchases from commercial banks during this period amounted to only $1 billion.
Arif Hossain Khan emphasised that with dollar supply currently exceeding demand, unchecked fluctuations could lead to an artificial decline in the exchange rate. By actively purchasing dollars from the market, the central bank is maintaining stability, safeguarding both expatriate remittances and the export sector, and bolstering the nation’s foreign currency reserves.