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Fear of further depreciation of the rupee against the dollar

by Afonso
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Credit rating agency Moody’s Investors Service has predicted that the rupee may depreciate another 4 percent against the dollar by June this year. According to the private credit rating agency, the dollar rate has increased from 110 this year and may reach 115 by June.

Moody’s, based on the dollar rate announced by Bangladesh Bank, gave this calculation. Besides, if the crawling peg is introduced in foreign exchange transactions, it will help to stabilize the dollar market, the agency believes.

ABB and BAFEDA, the association of bank chief executives, through the mediation of the central bank, fixed the dollar rate for imports at Tk 110. Although now importers have to buy dollars at 121 to 123 rupees. Again, the dollar rate for exports and remittances is fixed at 109 taka 50 paisa, but many banks are buying remittances at a rate of up to taka 122.

Earlier last year, the rupee depreciated by 16 percent against the major international currency, the dollar. Demand for the US currency has increased relative to supply due to rising import costs and declining incomes of illegal immigrants. This has allowed unimpeded money laundering. Analysts believe that the value of money is decreasing due to this.

However, Bangladesh Bank’s Chief Economist said that steps have been taken to strengthen the money. Habibur Rahman. The price of the dollar is increasing due to the gap between demand and supply of foreign currency in international trade settlement. As a result, money loses value regularly. For a long time, Bangladesh Bank artificially kept the rate of US currency at 85 to 86 taka.

At present, customers have to buy 110 taka 25 paisa per dollar in importing products. Last year it was 95 to 100 taka. In other words, the value of the rupee against the dollar has lost 16 percent over the course of a year. And in the last two years it is 30 percent.



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