B Mirror Report : Bangladesh has paid its import bills for November and December to the Asian Clearing Union (ACU), bringing the country’s foreign exchange reserves down to $32 billion.

Following the payment of $1.5352 billion to the ACU, Bangladesh’s total foreign exchange reserves declined to $32.34 billion, according to Bangladesh Bank.

The information was confirmed by Bangladesh Bank Executive Director and spokesperson Arif Hossain Khan.

An analysis of central bank data shows that Bangladesh’s reserves reached a historic peak of $48.06 billion in August 2022. Subsequently, large-scale capital flight by certain individuals and groups during the Awami League government led to a severe depletion of reserves. As reserves continued to fall each month, they dropped to $20.39 billion by the end of July 2024, just before the fall of the government.

After the formation of an interim government, the central bank adopted a stricter stance by refraining from selling dollars from reserves and taking tough measures to curb money laundering. At the same time, the shutdown of hundi channels boosted remittance inflows through legal channels, helping reserves recover. As a result, despite settling nearly $4 billion in overdue liabilities left by the previous government, reserves remain at a comfortable level.

According to Bangladesh Bank data, reserves exceeded $33 billion in December. Most recently, by the end of January 7, gross reserves stood at $33.78 billion. Under the International Monetary Fund’s (IMF) BPM-6 accounting method, reserves amounted to $29.19 billion.

In addition, Bangladesh Bank maintains another measure of net or actual reserves, which is not always publicly disclosed. Central bank sources say the Net International Reserves (NIR), or usable net reserves, are currently close to $24 billion.

At the current pace, with monthly imports averaging about $5.5 billion, these reserves can cover around four and a half months of import payments. Generally, a country is required to hold reserves sufficient to cover at least three months of imports. By that standard, Bangladesh is now in a relatively strong position. Foreign exchange reserves are considered one of the key indicators of a country’s economic health.