Bangladesh’s gross foreign exchange reserves rose to $36.39 billion as of Sunday, while reserves calculated under the IMF’s BPM6 methodology stood at $31.47 billion, putting the country in a relatively comfortable position to meet its external payment obligations.
With monthly merchandise import payments averaging around $6.5 billion, the BPM6 reserves provide about 4.8 months of import cover, well above the IMF benchmark of three months, Bangladesh Bank said.
Gross reserves had exceeded $37.5 billion last week but declined after the central bank made a $1.39 billion payment.
The stronger reserve position gives Bangladesh greater capacity to pay for essential imports and service foreign debt. It also provides a buffer against external shocks, particularly as oil, gas and fertiliser prices have risen amid the Middle East crisis.
However, economists caution that the rise in reserves should not be viewed entirely as a sign of stronger economic activity.
Dr Zahid Hussain, former lead economist of the World Bank in Dhaka, on Tuesday said the recent improvement in reserves is largely driven by stronger remittance inflows and increased use of formal channels.
“Weak import demand is also contributing to reserve accumulation, as private investment remains subdued and imports of capital machinery, industrial raw materials and intermediate goods have declined,” he told Waadaa.
In other words, fewer dollars are being used because economic activity and investment remain weak.
Bangladesh’s reserve cushion is smaller than those of major regional economies such as India and China, whose reserves cover roughly 10 to 12 months of imports. The comparison highlights Bangladesh’s greater dependence on steady remittance and export earnings, as well as relatively low import demand, to maintain its reserve position.
However, the latest position marks a significant improvement from recent years. Gross reserves stood at $33.18 billion in January 2026, while during the final period of the previous Awami League government, they had fallen to around $25.5 billion. BPM6 reserves were then about $20.47 billion.
Monthly remittances have risen to around $3 billion, compared with an earlier average of $1.7 billion to $1.8 billion. The stronger inflows have increased the supply of dollars in the banking system and helped rebuild reserves.
Bangladesh’s reserve position came under severe pressure after the Russia-Ukraine war pushed up global commodity prices in 2022. Higher import costs increased demand for dollars, while Bangladesh Bank sold foreign currency to meet import payments.
The resulting dollar shortage put pressure on the exchange rate and contributed to higher import costs and inflation.
The situation began to improve under the interim government as remittance inflows strengthened and more dollars entered the formal banking system. The upward trend has continued since the BNP government took office on February 17.