Bangladesh Bank (BB) has introduced a 'market-based' US dollar exchange rate, setting a cap on the maximum rate for H1 of the new fiscal year.

Under new rules, BB is selling dollars to commercial banks at Tk 108.85 per dollar, increasing Tk 2.85 from the previous rate.

Despite new system, the foreign exchange market is still volatile and banks are selling US dollars at different rates to clients on Tuesday (July 4), importers paid Tk 112 per dollar for LCs, which is against the competitive exchange rate formula.

Banks are taking higher rates for import LCs and the traders raised questions regarding whether the exchange rate is market-based or setting the willingness of banks.

Earlier, BB Governor Abdur Rauf Talukder said that Bangladesh Bank will not sell any more dollars to the banks at a discount rate from FY 24. So, the dollars will be sold at market-based rates, at the highest price in the interbank transaction.

Besides, Bangladesh Foreign Exchange Dealers Association (BAFEDA) has fixed the maximum dollar rate of Tk 109 under the interbank exchange rate.

Bd-pratidin English/Golam Rosul