The central bank has injected more than US$1.20 billion so far this fiscal year into the market to help keep the country's foreign exchange (forex) regime stable, officials said.
As part of the measure, the Bangladesh Bank (BB) sold the US currency directly to the commercial banks as liquidity support for meeting their import payment obligations, the officials said.
"We've provided such foreign currency support to the banks so that they can make import payment bills, particularly for fuel oils, capital machinery for power plants, LNG (liquefied natural gas) and fertiliser," a senior BB official told the FE on Monday.
He noted the central bank has also provided the US currency to the banks to help them make import payment obligations for electronic voting machines.
A total of $1.12 billion sold to the commercial banks during the first six months to December as part of its ongoing support, the BB data showed.
Besides, it was selling $97 million to the banks from January 01 to January 10 last to meet the growing demand for the greenback in the market, according to central bankers.
The central bank sold $ 2.31 billion during the FY 18 on the same ground.
The market operators, however, said the depreciating mode of local currency against the US dollar is still prevailing despite the central bank's foreign currency support.
The Bangladesh Taka (BDT) depreciated by five poisha against the greenback in the inter-bank foreign exchange market on January 03, mainly due to higher demand for the greenback, they added.
The US dollar was quoted at Tk 83.95 each in the inter-bank foreign exchange market on the day against Tk 83.90 of the previous working day.
It also remained unchanged at Tk 83.95 on Monday.
The demand for the US dollar is picking up, mainly due to higher import payment pressure, particularly for the petroleum products and the capital machinery for power plants, the market operators explained.
Meanwhile, imports of petroleum products climbed by 59.59 per cent to $1.79 billion in the July-November period of FY 19 from $1.12 billion in the same period of the FY 18.
The import of oil jumped due to the diversified use of gasoline products, particularly for power generation in Bangladesh, an official noted.
Currently, around 70 power plants out of the total 127 across the country are running on oil.
"The country's forex market remains volatile to some extent, despite the injection of the US currency by the central bank into the market," Syed Mahbubur Rahman, chairman of the Association of Bankers, Bangladesh (ABB), told the FE.
He also said that the overall import might increase in the near future, which pushed up pressure on the forex market.
Mr. Rahman, managing director and chief executive officer of Dhaka Bank Limited, suggested the authorities concerned take effective measures to increase the inflow of foreign currency through boosting export income while attracting foreign direct investments.
Talking to the FE, another BB official said the central bank may continue providing such foreign currency support to the banks in line with the market requirements.
He, however, expected that the demand for the US currency to subside gradually following upward trend in foreign funds inflows in the country.
The country's forex reserves rose to $31. 08 billion on Monday from $ 31.05 billion of the previous working day despite sales of the US dollar.
