Bangladesh’s foreign currency reserves have experienced a significant decline, dipping below the $30 billion mark for the second time this month.
According to the data from the central bank, on May 7, the reserves dropped to $29.77 billion as the Bangladesh Bank cleared import bills totaling $1.18 billion to the Asian Clearing Union.
Fortunately, two days later, the reserves slightly increased to $30.36 billion. This boost was attributed to loans provided by the World Bank, which injected $507 million into the government’s coffers.
The financial aid from the multilateral lender provided some respite to the struggling economy, grappling with various macroeconomic challenges.
However, recent reports reveal that on the 24th of this month, the reserves stood at $29.97 billion, highlighting a continuous downward trend.
In comparison, the reserves stood at $42.29 billion on the same day last year, indicating a staggering decline of approximately 30% over the past twelve months.
The depletion of reserves in Bangladesh has been a persistent issue for several months, primarily driven by higher imports coupled with lower-than-anticipated export earnings and remittances.
This imbalance between imports and exports has put immense pressure on the country’s foreign currency reserves, posing a significant challenge to its economic stability.