Bangladesh's Foreign Exchange Market Under Pressure as US Dollar Demand Surges

The foreign exchange market in Bangladesh is facing pressure due to rising demand for US dollars to settle import payments, causing interbank rates and commercial banks to be affected.

According to data from the Bangladesh Bank, the interbank exchange rate stood at Tk 123.82 per dollar on July 30, while the spot market rate traded at Tk 123.88 compared to Tk 122.85 just a month prior.

The pressure is attributed to a combination of domestic and global factors, including rising global fuel and commodity prices due to escalating geopolitical tensions in the Middle East.

Industry insiders also point out that Bangladesh's widening trade deficit and slowing remittance inflows are contributing to the strain on foreign reserves.