Foreign Exchange Marketplace of Bangladesh
1 . Introduction
1 ) 1 Aim
Objective of this report is to give an overview of the Foreign Exchange Market. To that, an attempt has been made to describe the size of the market, discover the dealers and factors, and give a concept about the dimensions of the market as well as the volume of trading.
1 . 2 Method
This statement has been based mostly on second research вЂ“ various guides of Bangladesh Bank and other banks, especially HSBC and Standard Chartered Bank, paper reports, web-sites on the internet, and some relaxed discussions with bank officials were the key sources intended for the information..
1 . several Scope and Limitations
A real assessment about the aspects protected in the survey would have be rigorous and is also beyond the scope on this report. Essentially, direct access to the information offered to the members of Bangladesh Foreign Exchange Traders Association (BAFEDA) BAFEDA can be required which was not available intended for the preparing of the record. However this report can be used as the foundation for further research.
2 . one particular Functions of the Foreign Exchange Industry
Foreign Exchange Industry allows values to be exchanged to help international trade and monetary transactions.
International Evolution from the market in Bangladesh is definitely closely linked with the exchange rate routine of the region. It had virtually no foreign exchange industry up to 1993. Bangladesh Lender, as agent of the authorities, was the singular purveyor of foreign currency amongst users. That tried to equilibrate the demand for and supply of foreign exchange at an officially determined exchange level, which, nevertheless , ceased to exist with introduction of current account convertibility.
2 . two Different Forex trading Regimes
Immediately after freedom, the Bangladesh currency taka was pegged with pound sterling unfortunately he brought for par with all the Indian rupee. Within a limited time, the value of taka experienced a rapid decline against foreign currencies and May 75, it was greatly devalued. In 1976, Bangladesh adopted a regime of managed float, which extended up to August 1979, when a currency-weighted bag method of exchange rate was introduced. The exchange rate management insurance plan was again replaced in 1983 by trade-weighted basket method and US the dollar was chosen since intervention forex. By this time a secondary exchange marketplace (SEM) was allowed to develop parallel to the official exchange rate. This gave go up to a вЂkerb' market.
About 1990, multiple exchange costs were allowed under several names of export advantage schemes including, Export Reward Scheme, XPL, XPB, EFAS, IECS, and Home Remittances Scheme. This kind of led to an extensive divergence between official charge and the SEARCH ENGINE OPTIMIZATION rate. The problem also little by little gave rise to a range of conflicting polices, poor risk management, and different kinds of implied or specific government assures to the users of forex trading. This led to a number of macro-economic imbalances forcing the government to modify the official level in levels and to exterminate its big difference with the rate at SEM. The two costs were finally unified in January 1992. The first step toward currency convertibility was used on 18 July 1993 and this designated the beginning of a comparatively open forex trading market near your vicinity. Until then this Bangladesh Financial institution used to state mid-rate combined with buying and selling costs for dollars applicable to authorized retailers. Initially the spread was Tk zero. 10, that was gradually widened to Tk 0. 30.
Until later in the year 2003, Bangladesh adopted an exchange rate coverage of from time to time adjusting the pace with an eye in maintaining export competitiveness, generally with reference to the trend of Real Effective Exchange Rate Index based on a trade weighted basket of currencies served as a sort of benchmark pertaining to the banking institutions to set their own rates.
From May well 31, 2003, the exchange rates intended for the Bangladesh Bank's place purchase and sale orders...
References: 1 ) Multinational Business Finance by simply David T. Eiteman, Arthur I. Stinehill, Michael L. Moffet
installment payments on your Bangladesh Assessment & Perspective - 3 years ago, HSBC
several. Bangladesh Lender, Annual Reviews 2002, the year 2003, 2004, 2006, 2006, 2007
4. Regular Currency roundup, Standard Chartered Bank
a few. Bangladesh Traditional bank Quarterly Report Oct-Dec, 2007
6th. The Sociable Organization of Remittances: Channelling Remittances by East and Southeast Asia to Bangladesh by Md Mizanur Rahman and Brenda S. A. Yeoh
almost 8. http://www.bafeda.com/