Money changers turn away customers due to limited dollar supply

Money changers in Dhaka are eager for a greater supply of dollars as the exchange rate of the currency shot up to a record high of Tk 105.30 amid steep demand. Some customers have left the outlets empty-handed as the supply of the greenback remains limited.

The exchange rate had previously surpassed previous records in May, when the rate was Tk 102 per dollar in local markets. In the following months, the price of a dollar somewhat steadied and hovered around Tk 97 to Tk 98 due to an increased supply of foreign banknotes.

But, it only took a week for the currency to blow past all previous records. Traders at money changers in the capital said that they are now facing a shortage of dollars. Some say they had expected a more stable supply as Hajj pilgrims were making their way home.

Palash Mahmud, a sales representative of the Neutral Money Exchange at Purana Paltan, said they sold the dollar at Tk 105.1-105.2 on Monday morning and had previously bought the currency at a maximum price of Tk 104.5.

Palash said people who return from Hajj sell their unused dollar notes to the money changers, boosting supply, but this has not been happening this year.

“Few are coming to us to sell dollars,” he said.

Rubel Sarkar, a salesman at Paltan’s Maximco Money Exchange, said that banks have cut back on selling dollar notes since Sunday afternoon, contributing to the soaring price of the dollar in the local market.

“We are selling $100-$300 maximum to each customer. But if anyone asked for $500 or more, it was not possible for us to sell,” Rubel said, adding that they are struggling to even manage $300 per customer. Rubel said he bought $500 at an exchange rate of Tk 104.2.

Obayed Hossain, a resident of Dhaka’s Elephant Road, was unable to buy dollar notes after coming to a money changer in Paltan.

“My nephew will travel to the United States. I needed some dollars for him. But two money changers said they were out of stock when I asked for $1,000,” Obayed said, adding that he will try to buy the notes in small amounts from other outlets.

The open market price of the dollar has also increased in banks. Social Islami Bank and NRB Commercial Bank sold dollars at Tk 102, whereas Meghna Bank sold the currency at Tk 101, according to data from the bank and central bank websites.

All bank branches that are registered for the dollar exchange have been selling dollars at prices over Tk 99, according to central bank data.

Meanwhile, the interbank exchange rate is Tk 94.45 per dollar, and the cross rate with the dollar is now at Tk 94.50. However, traders say that they were not able to purchase the currency at this rate and have had to pay Tk 100 per dollar.

In June last year, the price of the dollar stood at Tk 84.8.