The government is planning to introduce a floating exchange rate of the US dollar against Taka amid recent volatility in greenback price, Finance Minister AHM Mustafa Kamal said on Wednesday.
"We will go for a market-based exchange rate today or tomorrow," the minister said, pointing to the exchange rate of dollars, after a virtual meeting of the Cabinet Committee on Government Procurement.
The government is planning to handle foreign currencies like the other advanced economies, in the same way they deal currencies in their local and international markets, he added.
Usually, foreign currency rates are fixed by the central bank. However, the Bangladesh Foreign Exchange Dealers Association (Bafeda) and the Association of Bankers' Bangladesh (ABB) on Sunday set a new rate of US dollar for remittance at Tk108 and for export proceeds at Tk99.
The new rates are much higher than the central bank-fixed inter-bank dollar exchange rate, Tk96, for opening letter of credit (LC) for importing goods.
The central bank on Tuesday uploaded the exchange rate of dollars, as set by the Bafeda, on its website.
Following the new rates, introduced by Bafeda on Tuesday, the buying and selling rates stood between Tk102.37 and Tk106.90.
Meanwhile, asked if the government has any plan to raise deposit and lending rates of the banks from the existing 6% and 9% to help lower inflationary pressure, the minister answered no.
"I think the current rates are okay," he said, adding that containing inflation by raising or lowering interest rates in countries like Bangladesh is tough.”
Kamal opined that there are two ways to contain inflation -- by applying fiscal and monetary measures -- which the central bank usually does.
On the constant fall of foreign exchange (forex) reserve, which now stands at $37 billion against $48 billion in August last year, he noted that Bangladesh is still in a better position now in terms of forex reserve.
"Our export is rising and import is dropping, while remittance is rising very speedily."
The minister also said currently $2 billion was coming as remittance every month.
He was hopeful that the country's forex reserve would reach $48 billion, if the remittance flow continued.
Replying to another question, Kamal said the issue of importing fuel oil from Russia is yet to be finalized.
Bangladesh would have to make the payment against fuel oil import with a currency swap, if Russia is okay with doing that.