Bangladesh Bank on Monday decided to tighten its grip on the volatile foreign exchange market through strict measures and enhanced monitoring systems to restore stability.
A circular regarding the new directives is set to be issued today.
The decision was made during a meeting chaired by BB governor Ahsan H Mansur with managing directors of several banks.
The central bank instructed banks to maintain a uniform dollar rate for remittance and export earnings.
BB officials said that the central bank will publish a daily reference rate based on buy/sale data from banks submitted to the central bank鈥檚 dashboard.
Banks must conduct foreign currency transactions within a margin around this reference rate.
Non-compliance will result in monetary penalties, according to BB officials.
At the meeting, banks were asked to purchase dollars from remitters at below Tk 123.
The move follows widespread criticism of the central bank鈥檚 lack of oversight, which has led to the dollar鈥檚 price soaring to an alarming Tk 129.
Although BB identified instances where banks and money exchange houses stockpiled dollars and sold them at inflated rates for profit, no disciplinary actions had been taken.
The dollar price surged from Tk 120 to Tk 129 within just 13 days, exacerbating the ongoing forex market crisis.
In a meeting with the Bangladesh Bank on December 18, the IMF stressed the importance of adopting a more flexible and market-driven exchange rate system.
The dollar rate was Tk 94.7 in July 2022 and Tk 84.8 in July 2021.
Although remittance and export earnings increased in recent time, rising of the dollar rate to such level was unusual, bankers said.
They accused certain banks and money exchange houses of manipulating the market, stockpiling dollars unnecessarily and reselling them at exorbitant rates.
This deliberate profiteering has further destabilised the forex market and exacerbated the crisis.
The Bangladesh Bank on December 23 sought explanations from 13 commercial banks regarding a sudden surge in dollar prices on the market.
The surge in dollar prices has cascading effects, with the cost of essential commodities like onions, dates, soya bean oil, lentils and spices expected to rise ahead of Ramadan.
The surge came at a time when government efforts to stabilise prices and ensure adequate supply during the holy month are already under strain.
