The unofficial interbank exchange rate has come up in the discussion amid the country’s dollar deficit. Therefore, the Policy Research Institute (PRI) advised Bangladesh Bank to implement integrated and fully market-based exchange rates after the national elections.
The country has official integrated rates, but in reality they only appear on paper, said the private non-profit research firm.
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The agency also said that due to the dollar shortage in the market, many banks are reluctant to open loans, as a result of which people are forced to buy dollars at a much higher rate than the official rate.
The PRI organized a press conference on Bangladesh’s performance against the 4.7 billion dollar loan given to Bangladesh by the International Monetary Fund (IMF) at the beginning of this year.
In that press conference, Executive Director of PRI Ahsan H. Mansoor said, ‘This is not desirable.’
IMF recommends introduction of market-based exchange rate to Bangladesh Bank. The central bank has already introduced a pegged exchange rate to reduce pressure on foreign exchange reserves.
Aisan H. Mansoor said, “But Bangladesh Bank wanted to keep the inter-bank exchange rate for exporters and importers fixed at the central administrative level, so it could not be implemented effectively.”
Aisan H. Mansoor, a former economist at the IMF, said that the foreign exchange market is not trading at a coordinated rate.
He said, ‘There seems to be an unofficial market in the interbank market. The gap between the interbank curb market and the unofficial rate is low and the exchange rate gap between the official rate and the curb market is high.’
The two bankers’ associations have been fixing the dollar exchange rate for expatriates, exporters and importers for several months to prevent instability in the foreign exchange market.
At present banks are buying dollars from exporters at 110 taka 50 paise. At the same time, an incentive of up to 5 percent is expected to encourage expatriates to send dollars through legal channels.
According to the information of importers and bankers, most of the banks are not complying with the offer of selling dollars to importers at Tk 111.
As a result, banks are creating wrong data, said Ahsan H Mansoor.
He said, ‘Through this, the information of the financial sector is being corrupted, it is unacceptable. The exchange rate should be adjusted after the election.