The Bangladesh Bank (BB) has temporarily halted its dollar purchases and postponed a planned interest rate reduction to prevent exchange rate volatility stemming from the ongoing US-Israel military campaign against Iran.

Key Highlights:

• Policy Delayed: Governor Md Mostaqur Rahman postponed the upcoming monetary policy meeting until after Eid to avoid putting additional pressure on the foreign exchange market.

• Stable Reserves: The central bank remains in a comfortable position for now. Forex reserves stand at $30.5 billion (IMF calculation), which is enough to cover over four months of imports.

• Market Impact: The inter-bank dollar rate remains steady between Tk122 and Tk123, though the kerb market saw a slight increase to Tk126.

• Remittance Concerns: While early March remittances spiked to $377 million due to the upcoming Eid festival, officials warn that a prolonged Middle East conflict could severely impact the overseas job market, threatening future inflows from a region that provides over 50% of the country’s remittances.