The dollar holdings of Bangladesh鈥檚 commercial banks rose notably in May 2025, backed by increase in remittance inflows and export earnings, according to the latest data from Bangladesh Bank.
In May, banks鈥� gross foreign currency balance stood at $4,971 million, up from $4,495 million in April and $4,255 million in December. The December figure had marked the lowest level since June 2019, when balances dropped to $4,191.18 million.
Bankers attributed the steady three-month rise in dollar holdings to the sharp increase in both remittance inflows and export receipts.
From July 2024 to May 2025, remittances reached $27.5 billion, up by 28.7 per cent from $21.37 billion during the same period in the previous fiscal year. Since August 2024, monthly inflows have consistently remained above the $2 billion mark.
Export earnings also posted a 10 per cent year-on-year growth, totalling $44.95 billion in the July鈥揗ay period of FY25, compared with $40.86 billion in the same period of FY24, according to Export Promotion Bureau data.
Another reason behind the rise in banks鈥� dollar balances was the central bank鈥檚 move to settle a large portion of its external payment obligations by December 2024. This allowed commercial banks to retain more foreign currency in their coffers in the months that followed.
At the same time, demand for dollars has softened amid a fragile business environment.
聽Ongoing economic stress, political unrest following the change in regime, and reduced industrial activity have led to a drop in imports鈥攑articularly of raw聽 materials鈥攁s many businesses scaled back operations or paused production.
Bankers also said that the decline in money laundering through informal channels has helped increase formal banking sector dollar holdings.
The reduced gap between the interbank exchange rate and the unofficial hundi market rate encouraged more migrants to remit money through official channels.
Previously, migrants preferred informal methods due to higher returns in the open market.
However, the official interbank rate climbed to Tk 123 per US dollar in May 2025, up from Tk 110 in December 2023, Tk 106 in June 2023, and Tk 93.45 in June 2022.
To ease pressure on reserves, the Bangladesh Bank has stopped selling dollars to commercial banks and has instead resumed dollar purchases to shore up its own holdings.
As of June 15, the country鈥檚 gross foreign exchange reserve stood at around $20.86 billion,聽measured under the IMF鈥檚 Balance of Payments and International Investment Position Manual (BPM6) guidelines.
