Bangladesh's imports dropped 31% in July, compared to the month before, because of regulatory measures to ease pressure of import-payment obligations.
The opening of letters of credit (LC), generally known as import orders, dropped over 31% to $5.47 billion in July 2022 from $7.96 billion a month before, according to Bangladesh Bank's latest statistics.
A top central bank official said that close monitoring of import LCs will continue until stability returns to the country's forex market.
Earlier on July 14, the central bank started monitoring LCs worth $5 million and above initially, using its dashboard, to discourage 'unnecessary' imports.
Currently, the central bank monitors LCs worth $3 million and above on the same grounds.
During monitoring, they examine different documents like rules of origin and price of the imported products on a case-to-case basis to discourage unnecessary imports.
Earlier on July 25, bankers were asked at a bankers' meeting to comply with all the ten regulatory measures announced by the central bank recently aiming to improve the foreign-currency-liquidity situation on the money market.
Among the regulatory measures were encashing 50% of total foreign currency held in relevant export retention quota (ERQ) accounts, slashing 5 percentage points of the net open position (NOP) limit of commercial banks and reporting prior to opening a letter of credit (LC) for imports worth $5 million or above to the central bank.
Lower import orders along with higher inflow of remittances will help ease the volatility on the country's foreign-exchange market in the near future, according to officials.
It will also help curb the falling trend in the country's foreign-exchange reserves, the central banker noted.
The central bank continued its regulatory drive on money exchangers until Sunday aiming to bring stability in the price of the US currency on the open market, known as kerb market.
The BB made a drive at different money exchanges in Dhaka on Wednesday, just a day after the cash dollar price hit an all-time high of Tk112 on the kerb market.
Bangladesh's forex reserves rose to $39.54 billion on Sunday from $39.47 billion on the previous working day following the upward trend in inflow of foreign exchange.
