Bangladeshi Taka Strengthens Against US Dollar for First Time in Five Years

The Bangladeshi Taka (BDT) has shown signs of appreciation against the US dollar for the first time in five and a half years, according to a report from the Bangladesh Bank. On a point-to-point basis from June last year to June this year, the value of the Taka appreciated by 0.06 percent.

However, a more significant gain was seen between August 30 and September 17, where the local currency strengthened by 0.77 percent against the greenback. The trend began reversing in the second half of this year after peaking at Tk 123.95 on August 30, the dollar rate dropped by 95 paisa to Tk 123.00 on September 17.

The Bangladesh Bank report compared regional currency movements from June last year to June this year and found that the Indian Rupee depreciated by nearly 9.5 percent, the Sri Lankan Rupee lost over 10 percent, and the Indonesian Rupiah declined by around 9 percent. On the other hand, the Malaysian Ringgit and Chinese Yuan both gained nearly 4 percent.

The central bank noted that after a prolonged period of weakening, the Bangladeshi Taka has shifted to a relatively stronger position. A strengthening Taka relieves pressure on import expenditures and lowers the local currency cost of foreign debt servicing, though the broader impact will depend on future trends in imports, exports, remittances, foreign exchange reserves, and international market conditions.