An upward trend of remittance inflow and lower import expenditure has enabled the country's foreign exchange reserve to witness a record of $46 billion for the first time, amid the Covid-19 pandemic.
According to Bangladesh Bank data, the reserves stood at $46.082 billion on Tuesday, crossing the $45 million mark earlier in May.
An inward remittance amounting to up to $1.75 billion was recorded between June 1 to June 28, according to the central bank.
In contrast, a remittance of $1.66 billion was recorded last year during the same period, and the government’s finance wing had hoped of crossing the $50 billion mark this year.
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The central bank credited the rise in foreign exchange influx and the decrease in expenditure on imported goods for the reserves increase.
Experts think that a big chunk of money came back with the workers who returned home amid the pandemic and the government’s offer of a 2% cash incentive against remittance discouraged illegal hundi, and they ultimately contributed to the rise in remittance inflow.
The central bank has also been reportedly mopping up the excess supply of dollars from the local market and enabling itself to build up the reserves.
However, they think although reserve growth is a sign of strength for the economy, indicating the nation’s capacity to clear foreign debt, its management can be a big challenge.