TDS Desk:

The deficit in the country’s current account balance and trade balance narrowed significantly in July, riding on negative import growth during the protests led by the Anti-discrimination Student Movement which led to the ouster of the Sheikh Hasina-led Awami League government.

Strong rebound in remittance inflow after the formation of the interim government in August gave the central bank breathing space by increasing dollar availability in the forex market.

The balance of payment statement shows the deficit in the current account which contained primary income and expenditure narrowed by 34.5% to $193 million in the first month of the current fiscal year from $295 million in the month of the last year.

The ease in current account balance helped to reduce the trade deficit by 9% to $1.4 billion during the month from $1.6 billion in the same month of the previous year.

The import expenditure registered negative 2.6% year-on-year growth during the month when export was slightly positive of 0.4% growth helping to ease pressure on external balance.

Though remittance growth fell by 3% during the month due to internet disruption and bank closure amid anti-government movement, it experienced strong rebound in August after the ouster of Hasina’s government.

Speaking to media, a senior executive of Bangladesh Bank said pressure on external balance eased in July only because of low import. However, he hoped that it would improve further in August due to strong remittance growth.

Bangladesh received a whopping $2.2 billion in remittances in the just concluded August, registering a 39% year-on-year increase, according to Bangladesh Bank data.

In August 2023, expatriates sent $1.6 billion in remittances. Compared to July 2024, remittance inflow in August surged by 16%. In July, the country’s banks received $1.91 billion in remittances.