The dollar rate on the open market, also known as the kerb market, rose by over Tk聽4 in the past three days to reach Tk聽124 a dollar on Tuesday amid unrests centring quota reform protests.
Officials of money exchange houses said that the inflow of dollars was disrupted by a nationwide curfew, general holidays and an internet shutdown.
They said that they could not get enough dollars at previous prices as banks had also increased dollar prices.
A number of banks have increased the price of dollar up to Tk聽120 on Tuesday after getting reportedly a Bangladesh Bank verbal instruction to raise the rate to attract more remittance in the legal channel.
Before the unrest, the dollar rate was Tk 119 to Tk聽120 on the kerb market.
Remittance inflow has declined due to the ongoing unrests in the country.
According to Bangladesh Bank data, the daily average remittance inflow, which was about $79 million in the first 18 days of July, plummeted to $18 million in July 21-28.
Expatriates sent only $147 million from July 21 to 28, compared with $450 million in the previous week (July 14 to 20), $608 million from July 7 to 13, and $370 million from July 1 to 6.
In the period from July 1 to 28, the total remittance plunged by 30.37 per cent to $1.65 billion compared with that of $2.37 billion in the same period in June.聽 Remittance inflow was $2.54 billion in the whole month of June.
The government imposed a curfew in the country from midnight past July 19 as unrests over quota reform protests escalated. More than 200 people were killed and several thousand were injured in the protests since July 16.
An internet blackout starting on July 18 further halted digital and mobile financial services.
The government also declared a general holiday from July 21 to July 23, keeping offices, including banks, closed.
The curfew was relaxed on July 24, allowing offices and banks to open.
A partial restoration of broadband internet began on the evening of July 23, with the gradual expansion of services.
On May 8, the Bangladesh Bank increased dollar rate by Tk聽7 to Tk聽117 each as it introduced the crawling peg exchange rate system for buying and selling dollars.
The exchange rate was Tk聽94.7 in July 2022 and Tk 84.8 in July 2021, indicating a 40-per cent devaluation of the taka over three years.
The ongoing dollar crisis is attributed to various factors, including a significant gap between supply of and demand for dollars in the country.
The depletion of foreign exchange reserves, poor inflows of remittances and low export earnings are contributing to the imbalance in the foreign exchange market.
The dominance of the informal 鈥榟undi鈥� market, where unofficial currency trading occurs, also plays a role in exacerbating the crisis, according to economists.
The foreign currency reserves, according to International Monetary Fund guidelines, dropped to $20.46 billion on July 10.
