5:18 pm - Monday June 14, 0855

FX reserves slip from record high

Bangladesh’s foreign exchange reserves edged down to nearly $27.14 billion by January-end from a record high of $27.49 billion in the previous month, but were up 23 percent from a year earlier, the central bank said on Monday.

A senior central bank official attributed the drop in January to a rise in imports; the reserves forexare enough to cover more than seven months of imports.

Garment exports and remittances from Bangladeshis working overseas – two mainstay revenue generators – have helped foreign exchange reserves grow steadily in recent years.

Bangladesh’s exports in July-December, the first half of the current financial year, rose 7.8 percent to $16.1 billion from the previous year, led by strong garment sales as the key industry is trying to repair its safety image after several fatal accidents.

Last month, the central bank cut its key interest rates by half a percentage point for the first time in nearly three years as cooling inflation gives it more manoeuvring room to help spur economic growth.

The central bank expects economic growth to reach 7 percent, picking up from 6.51 percent in the previous year when political unrest crippled the economy.