Bangladesh Bank has stepped up its intervention in the foreign exchange market, purchasing $134 million through auctions on Thursday, pushing its total US dollar acquisitions to $1.13 billion since mid-July under the free-floating exchange rate regime.
According to officials, the latest purchase – conducted via a multiple-price auction with a cutoff of Tk 121.75 per dollar – involved five commercial banks.
The central bank’s steady buying is aimed at stabilising the taka-dollar exchange rate and bolstering reserves, as Bangladesh prepares to settle $1.5 billion in Asian Clearing Union (ACU) payments on Sunday.
Market analysts said the intervention is helping maintain exchange rate stability while simultaneously shoring up liquidity. By sourcing US dollars, the central bank has injected more than Tk 13,700 crore into the banking system, increasing liquidity at local banks.
Forex reserve levels have improved in recent weeks, reaching $31.43 billion on September 3, up from $31.18 billion in August and $29.80 billion in late July, according to central bank data.
Despite the looming ACU settlement, officials expect reserves to remain above $30 billion.
The exchange rate has also firmed following the central bank’s actions. The reference rate, which had been under downward pressure, reversed course and climbed from about Tk 121.7 per dollar on August 28 to Tk 121.8 on September 4.
Dealers noted that interbank spot market transactions have slowed in recent days amid increased foreign currency supply and subdued demand.