by Naim-Ul-Karim
DHAKA, Sept. 1 (Xinhua) -- In an apparent bid to ease pressure on foreign exchange reserves and end volatility in the forex market, the central bank of Bangladesh has ordered the selling of extra U.S. dollars in the possession of individuals by the end of this month, an official said on Thursday.
Legal action will be taken if someone is found in possession of more greenbacks than the permissible limit after Sept. 30, said the official, quoting a Bangladesh Bank (BB) order issued on Wednesday.
The official who did not like to be named said, "We'll seek legal measures against people who fail to sell their extra U.S. dollars before the deadline."
In accordance with the law, the official said, when returning from abroad a Bangladeshi national could possess a maximum of 10,000 U.S. dollars or an amount equivalent in other currencies.
BB spokesperson Md Serajul Islam told journalists that all the financial institutions in the country will come under scrutiny on the U.S. dollar issue. Also, he said legal action will be taken if any irregularities are found.
Apart from this, BB reportedly has been asking banks in the country to provide information on U.S. dollar related operations including the exchange profit.
BB has recently intensified its monitoring and is checking some banks over excessive profits from U.S. dollar manipulation. As part of a punitive measure, BB last month removed the treasury heads of six banks.
Owing to volatility in the country's foreign exchange market, the U.S. dollar reached an all-time high against the Bangladeshi taka last month, soaring to 115 taka for the first time in the country's curb market trading history.
Due in part to higher import bills and the taka's weakness driven by the U.S. dollar's broad surge in recent months, Bangladesh's foreign exchange reserves in July fell below 40 billion U.S. dollars for the first time in two years.
By the end of August this year, Bangladesh's foreign exchange reserves stood at 39.05 billion U.S. dollars, the latest central bank data showed.
As BB is set to make a routine payment worth 1.73 billion U.S. dollars to the ACU (Asian Clearing Union), officials said the country's foreign exchange reserves look set to slip below 38 billion U.S. dollars later this month.
The Bangladeshi government has recently said it is contemplating taking loans from the International Monetary Fund as precautionary measures.
Ahmad Kaikaus, principal secretary to the Bangladeshi prime minister, said the government does not seek a bailout, but is thinking of taking pragmatic measures in advance to address uncertainties ahead due to the adverse impacts of continuation of the Russia-Ukraine conflict. ■