The taka strengthened against the US dollar in August as foreign exchange liquidity improved and the American greenback weakened globally, but intervention by Bangladesh Bank (BB) kept the exchange rate broadly stable.
The taka strengthened to 121.40 per US dollar on August 10 from 122.30 at the end of July, according to BB’s Exchange Rate & Foreign Exchange Market Dynamics report.
For all latest news, follow The Daily Star’s Google News channel.
The central bank responded by purchasing foreign currency through auctions, buying a net $454 million during the month. The intervention offset part of the appreciation pressure, with the interbank rate closing August at 121.69 per dollar.
Interbank foreign exchange transactions in Bangladesh are comprised mainly of spot and swap deals between authorised dealer banks, while forward trades remain infrequent and small in size.
Market activity slowed in August — average daily spot transactions fell to $33.23 million from $40.75 million in July. The share of spot trades in overall interbank activity also slipped to 30.22 percent from 32.14 percent a month earlier.
The favourable developments in the balance of payments, supported by strong inflows of foreign currencies and sluggish import growth, have put appreciation pressure on the exchange rate since June 2025, BB said in the report.
The rising trend of foreign exchange liquidity and appreciation pressure on the taka led the central bank to purchase foreign currency through auction in line with its intervention strategy. BB purchased a total of $454 million from the foreign exchange market in August 2025.
Meanwhile, gross international reserves, measured under BPM6, continued to grow, rising to $26.18 billion at the end of August from $24.78 billion in July.
The increase was due mainly to BB’s intervention in the foreign exchange market with purchases and commercial banks’ deposits to BB for payments of Asian Clearing Union liabilities, the central bank said in the report.