The US dollar has started appreciating sharply in both the open market and banking channel, driven by increased demand and a shortage of cash dollars. The rise has also pushed up the prices of other foreign currencies and increased import costs.

Banks are currently selling cash dollars at up to Tk 126.50, while the rate in the open market has climbed to Tk 128.50 per dollar.

According to banks’ declared rates, City Bank bought cash dollars from expatriates at Tk 124.75 and sold them at Tk 126 on Thursday. BRAC Bank purchased dollars at Tk 125.50 and sold them at Tk 126.50, while United Commercial Bank (UCB) bought them at Tk 125 and sold them at Tk 126.25. Agrani Bank purchased dollars at Tk 123 and sold them at Tk 124.

The price of dollars traded among banks for import payments has also increased. On October 19, banks bought dollars from one another at a maximum rate of Tk 123.60, which rose to Tk 123.99 last Thursday. Rates have increased by Tk 0.05 to Tk 0.20 almost every day during the period.

Open market rates higher Despite banks selling dollars at up to Tk 126.50, prices in the retail market are significantly higher. On Thursday, money changers in Motijheel sold dollars at Tk 128.50 and bought them from customers at up to Tk 128.

Bangladesh Bank officials and bankers said the movement of passengers to and from abroad had declined significantly following the Middle East crisis, contributing to a shortage of dollars in the open market.

Around 10 days ago, the open-market dollar rate was between Tk 127 and Tk 127.50. Since then, the price has increased by as much as Tk 1 per dollar in both the open market and the banking sector.