IMF lauds Bangladesh’s reserve build-up

NN ONLINE:

The International Monetary Fund (IMF) has welcomed the increase in foreign exchange reserves by the Bangladesh Bank.

“The accumulation of reserves is considered a central objective of the IMF-supported programme, particularly given that the country continues to face balance of payments pressures,” said Thomas Helbling, deputy director of the IMF’s Asia and Pacific Department.

Responding to a question at a press briefing in Hong Kong on Friday on Asia-Pacific economic developments, he said that the goal of increasing reserves is key to reducing balance of payments vulnerabilities. He specifically welcomed the central bank’s success in accumulating these reserves.

He mentioned that an IMF mission is expected to visit Bangladesh this month for the fifth review of the conditions tied to the $5.5 billion loan.  “They will conduct discussions with the authorities, and it remains to be seen what the outcome is. The mission will be in the field,” he said,

However, the IMF will also assess whether the modalities of these interventions align with the Bangladesh Bank’s (BB) declared exchange rate regime.

Bangladesh’s foreign exchange reserves rose to $27.35 billion as per the IMF’s calculation method on October 16, up from $19.93 billion a year earlier, owing to higher inflows than outflows and the central bank’s purchases from the market.