In September of this year, the foreign exchange reserves of the country experienced a significant decrease, exceeding 2 billion dollars. This rapid decline represents an 8.75 %, erosion in reserves in just one month, an unprecedented loss. Based on international benchmark standards (BPM6), the reserves have now dwindled to $21 billion, and according to the International Monetary Fund (IMF), Bangladesh’s net reserves currently stand at $17 billion.
Historical data from Bangladesh Bank shows that the country’s highest reserves were recorded in August 2021 when they reached $48 billion. Since then, a gradual depletion of reserves began, with an average monthly decrease of $1 billion over the past two years. However, the sudden loss of $2 billion in reserves in a single month is cause for concern.
Experts view this rapid decline as a troubling sign, raising questions about the state of reserves come December. Failure to meet certain conditions has even raised the possibility of suspending the second tranche of the promised IMF loan, intensifying the country’s reserve crisis. Such a scenario could also impact the ability of the country’s banking sector to meet import liabilities and repay foreign loans.
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