Bangladesh’s foreign exchange reserves crossed $29 billion this month for the first time since the central bank began calculating the stock in line with the International Monetary Fund (IMF) method.

Today, reserves stood at $29.47 billion, up from $29.23 billion recorded on February 5, according to Bangladesh Bank (BB).

This is the highest level since July 12, 2023, when the BB started computing reserves under the sixth edition of the IMF’s Balance of Payments and International Investment Position Manual (BPM6) — a global framework that reflects readily available reserves to clear import bills and other international obligations.

Thanks to rising remittances and moderated import demand, reserves have been gradually replenishing for more than a year.

The turnaround began after the fall of the Awami League government in August last year, as remittance inflows increased.

The BB said gross reserves reached $34.06 billion today, the highest since November 2022. Continued purchases of the greenback also supported the rebound.

Previously, the BB had sold dollars to support the taka’s value, but at the start of the current fiscal year it began buying US dollars from banks to curb depreciation and stabilize the exchange rate.

The central bank reported purchasing $4.3 billion during this fiscal year from the interbank market through transparent auctions to build reserves.

In its monetary policy for January-June, the BB said it will maintain a focus on exchange rate flexibility, leveraging strong remittance inflows and improved reserves to buffer against external shocks.

Bangladesh’s gross reserves had crossed $48 billion in August 2021 for the first time. They later declined due to a sharp spike in imports following the removal of Covid-19 curbs and rising global commodity prices amid the Russia-Ukraine war.

By May 2024, overall dollar holdings had fallen to $24 billion.