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Economy
Jul-Oct FY23 trade deficit was USD 9.6bn and current account deficit is USD 4.5bn
December 6, 2022
· The country's external trade deficit has widened by 4.69% to USD 9.59 bn year-on-year in the first four months of the current fiscal year, but this trade gap in October was lower than the previous three months.
· Bangladesh Bank data shows the deficit – the difference between the country's imports and exports – in September was USD 3 bn, which was USD 2.47 bn in August and USD 2.08 bn in July.
· Imports totaled USD 25.51 bn in the July-October period, which was USD 23.90 bn in the same period last year. Bangladesh's merchandise exports figured at USD 15.92 bn, up from USD 14.74 bn a year ago.
· Import payments were USD 6.16 bn in October, USD 6.66 bn in September, USD 6.83 bn in August and USD 5.86 bn in July.
From: https://www.tbsnews.net/economy/oct-trade-gap-lowest-four-months-still-469-high-yoy-546762
https://www.newagebd.net/article/188434/trade-deficit-rises-in-july-oct
https://today.thefinancialexpress.com.bd/first-page/deficit-in-trade-balance-widens-1670352173
Central bank raises its dollar selling rate by BDT 1
December 6, 2022
· The Bangladesh Bank has raised the rate of dollars sold from its reserves by BDT 1 to BDT 99 on Monday.
· Earlier, in November, the central bank set the dollar selling rate at BDT 98, an increase of BDT 1 from BDT 97 set in October.
· Seeking anonymity, a treasury department official of a government bank said, "We collected dollars at BDT 98 for more than two weeks. On Monday, the rate was increased to BDT 99. We purchased around USD 10 million from the central bank on Tuesday."
· Sources say the central bank sold USD 67 million to the state-owned banks on Tuesday.
· The Bangladesh Bank has increased the dollar price 10 times since July of the current financial year.
· According to the central bank, USD 6.60 bn has been sold from reserves in about five months of the current financial year. Reserves stood at around USD 33.98 bn at the end of the day on Tuesday. In 2021-22, USD 7.62 bn was sold from reserves.
From: https://www.tbsnews.net/economy/banking/central-bank-raises-its-dollar-selling-rate-tk1-546758
BB injects BDT 4,000cr into 5 Islamic banks
December 7, 2022
· Five Islamic banks yesterday borrowed nearly BDT 4,000 crore from Bangladesh Bank right after a liquidity support arrangement was offered by the central bank to cash-strapped Shariah-based banks.
· The five are Islami Bank Bangladesh, Social Islami Bank, First Security Islami Bank, Global Islami Bank and Union Bank, said a senior official of the central bank.
· The boards of the five Shariah-based banks are controlled by S Alam Group, a Chattogram-based business conglomerate.
· The BB on Monday announced that it would provide short-term loans for 14 days under an arrangement named "Islamic Bank Liquidity Facility".
· This is the first such initiative of the central bank, coinciding with a liquidity stress being faced by a number of Shariah-based banks in Bangladesh stemming from deposit withdrawals amidst allegations of lending irregularities surfacing against the lenders.
Monetary policy to be formulated twice a year: BB
December 6, 2022
· Bangladesh Bank (BB) has again decided to formulate monetary policy twice a year as per the advice of the International Monetary Fund (IMF).
· The central bank in a meeting with economists yesterday took the decision. As part of this, the monetary policy will start formulation for the second half of the current fiscal year in January next year, Bangladesh Bank's Chief Economist Habibur Rahman told UNB today.
· "We have discussed various aspects of macroeconomics, including money supply, reserve currency, and interest rates, with all stakeholders, including economists of the country. The current challenges of the economy were also discussed," he added.
· As per the suggestion of the economists the central bank decided to formulate the monetary policy twice a year, he said.
· The central bank will announce the monetary policy for the second half of the financial year in January.
ADB VP to discuss USD 1.0b loan for budget support and to provide USD 200m in loan to strengthen microfinance
December 7, 2022
· Ashok Lavasa, vice-president of Asian Development Bank (ADB), was scheduled to arrive in Dhaka Tuesday night to discuss Bangladesh's requirement of USD 1.0 bn in loan assistance for budget implementation, Economic Relations Department (ERD) sources have said, reports UNB.
· Lavasa, in-charge of Private Sector Operations and Public-Private Partnerships, will meet the planning minister and foreign minister during his weeklong visit.
· The ADB vice-president will also have discussion with Bangladesh Bank on debt management, government expenditure and other issues.
· The Asian Development Bank (ADB) on Tuesday confirmed that it would provide USUSD 200 million in loan to Bangladesh in order to strengthen its microfinance, supporting microenterprises, especially those owned by women and those located in the country's climate risk-prone regions.
· The foreign aid will be provided to the Palli Karma Sahayak Foundation (PKSF), in a bid to increase the liquidity of its partner microfinance institutions (MFIs).
· The project will develop a business plan update and digitalisation roadmap for PKSF as well as a diagnostic review of its partner MFIs' operational costs to enhance their viabilities.
· Eligible MFIs to receive financing through PKSF will dedicate at least 10 per cent of their lending portfolio to microenterprises coming from regions facing adverse climate risks, such as floods, cyclones, and drought.
Commodity
Incentives for rice import may prolong
December 7, 2022
· Bangladesh may extend the tax benefit for import of rice by three months until March to contain price rises of the staple, particularly in the lean period before next harvest.
· Officials say the contingency plan is under consideration as global prices of the staple grain surged, putting in difficulty the importers to meet their import target by this month-end.
· The pared-down tax on import of rice is scheduled to expire this month, by December 31, with imports far below the mark and government procurement internally also falling short.
· Official sources say a move is on to extend the tax benefit further to facilitate import of rice and ensure uninterrupted supply of rice to the consumers-incidentally, in the wake of a global prognosis.
· A recent monthly report of the Food and Agriculture Organization (FAO) said the current rice prices are 14.7-percent higher than those a year ago.