The Dhaka Stock Exchange extended its bullish momentum for a second consecutive session yesterday (19 January) as renewed buying interest across sectors lifted the benchmark index sharply, reflecting a significant recovery in investor sentiment after a prolonged period of market sluggishness.

The benchmark DSEX index jumped 56 points, or 1.12%, to close at 5,091, bringing the cumulative gain over the last two trading days to 133 points. This rally bolstered the market capitalisation by approximately Tk9,000 crore, highlighting the broad-based nature of the day's gains.

The blue-chip index, DS30, also posted a strong performance, rising by 25 points, or 1.33%, to settle at 1,964. Market breadth remained decisively positive, with 268 issues advancing against 72 decliners, while 54 stocks closed unchanged, indicating widespread participation in the rally.

Turnover, a key indicator of market activity, surged by 25% to Tk593 crore, marking a two-month high. The volume was close to the recent peak of Tk636 crore recorded on 25 November 2025, suggesting that both institutional and retail investors are returning to the market with increased confidence.

A managing director of a brokerage firm said the market often witnesses a rally from mid-January each year, largely driven by institutional investors stepping up their participation after year-end adjustments.

He noted that the current market levels remain attractive following a prolonged subdued phase, during which many fundamentally strong stocks traded at discounted prices. As a result, both institutional and retail investors are actively positioning themselves on the buy side.

He further added that the upcoming national election has also sent a positive signal to the market, helping to reduce uncertainty and improve overall investor confidence.

Trading activity was concentrated in several heavyweight and actively traded stocks, with Square Pharmaceuticals, Prime Bank, City Bank, BRAC Bank, and Orion Infusion featuring among the top turnover contributors for the day. These stocks played a key role in pulling the indices higher.

All major large-cap sectors closed in positive territory, reinforcing the strength of the rally. The non-bank financial institution sector led the gains with a jump of over 2%, followed by strong performances from the food and allied, pharmaceutical, and engineering sectors. Fuel and power, telecommunication, and banking stocks also posted modest but positive returns, indicating a balanced sectoral recovery rather than a narrow rally.

The upbeat trend was mirrored at the Chittagong Stock Exchange as well. The CSCX index rose by 65 points to close at 8,791, while the broader CASPI advanced 111 points to settle at 14,198. Turnover at the port city bourse stood at Tk12.33 crore, reflecting improved trading activity there too.

Gold surged past the $4,700 an ounce mark for the first time on Tuesday, and silver hovered just below a fresh record high, as global tensions sparked yet another rush to safety.

Spot gold gained 1.3 percent to $4,727.99 per ounce by 0910 GMT, having hit an all-time high of $4,731.34, while silver rose 0.7 percent to $95.34 an ounce, after hitting a record high of $95.488 earlier in the session.

US gold futures for February delivery climbed 3 percent to $4,734.10 per ounce.

US President Donald Trump threatened to impose increasing tariffs from February 1 on eight European countries until the US is allowed to buy Greenland, fuelling fears of a renewed trade war.

“Growth concerns driven by threats of additional tariffs and the desire of Trump to have lower US interest rates are the drivers pushing gold to a new record high,” said UBS analyst Giovanni Staunovo.

Gold has climbed 9.5 percent in just 20 days of this year and over 70 percent since Trump’s second term began a year ago. Geopolitical tensions have been at the forefront of the recent record rally, with expectations of monetary policy easing also playing a significant role. Strong central bank buying and ETF inflows have also contributed to the unprecedented rise.

Instability in policy and politics drives investors to store value in traditional safe havens like gold, while lower interest rates limit the downside of holding non-yielding assets.

Investors are also awaiting a decision on a Supreme Court case that could determine whether the president can dismiss Federal Reserve governors at will, concerning Trump’s attempts to fire Fed Governor Lisa Cook.

“We still see further upside for the yellow metal, targeting a price of $5,000/oz,” Staunovo said.

The growing threat of a renewed trade war between the United States and the European Union is stoking fears among Bangladeshi garment exporters that retaliatory tariffs could trigger global supply chain volatility and suppress consumer demand in their most vital markets.

Industry insiders say any escalation of tariff measures between the two economic blocs could trigger fresh inflation in the US and Europe, reducing consumer spending and, in turn, demand for Bangladeshi apparel. Such a scenario could further strain exports.

Data show that Bangladesh's overall exports, including readymade garments, have been declining for five consecutive months, while prices in the European market have also softened during the period.

Representatives of foreign buyers sourcing from Bangladesh, however, believe the immediate impact of any new tariff measures would be limited, although prolonged trade tensions could create uncertainty over the longer term.

According to a report by The Guardian, the EU's top diplomats met for crisis talks on Sunday (18 January) and discussed reviving a plan to levy tariffs on €93 billion ($108 billion) of US goods, which was suspended after last year's trade deal with Trump.

In a post on Saturday on Truth Social, US President Donald Trump said he would impose a 10% tariff on Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland beginning 1 February.

Media reports also said Trump threatens a 25% tariff on European allies until Denmark sells Greenland to the US.

Experts warn that such tariff disputes could destabilise not only transatlantic trade but the wider global trading system.

MA Rahim Feroz, vice-chairman of DBL Group – one of Bangladesh's largest apparel exporters with annual turnover exceeding $1 billion – told TBS that higher tariffs in Europe or the US would inevitably lead to inflation.

"If inflation rises, consumers will buy less, which will put significant pressure on us and negatively affect Bangladesh's exports to those markets," he said.

Echoing Feroz, Md Shehab Udduza Chowdhury, vice president of the Bangladesh Garment Manufacturers and Exporters Association, warned that imports could be affected if trade tensions intensify.

In 2025, Bangladesh exported garments worth $38.82 billion globally, with nearly 80% destined for the European Union, the US and the UK.

Exporters say Bangladesh has already felt the impact of reciprocal tariffs imposed by the Trump administration, with shipments to both the US and Europe coming under strain. They add that garment prices in the European market have declined as a result.

Feroz noted that after the US imposed higher tariffs on China and India than on Bangladesh, the two larger exporters stepped up efforts to sell more in Europe, intensifying competition and forcing Bangladeshi exporters to offer price discounts.

An analysis of Eurostat data by the Bangladesh Apparel Exchange shows that the average price of Bangladeshi apparel exported to Europe fell by 2.06% between January and September 2025. Prices of apparel from other major exporting countries also declined during the same period.

Trade experts see little upside for Bangladesh if a trade war erupts between Europe and the US.

Mostafa Abid Khan, an international trade expert and former member of the Bangladesh Trade and Tariff Commission, said he does not foresee any major short-term disruption to Bangladesh's exports or imports.

Before the latest tariff announcements, US tariffs on EU goods ranged from zero to 15%, while UK exports to the US faced a 10% tariff. US goods entering the UK are subject to a 6% tariff, and EU data show that a significant number of US products have enjoyed duty-free access to the EU since August.

Buyers remain unconcerned

Despite exporters' worries, foreign buyers say their sourcing from Bangladesh remains unaffected.

A senior official at the Dhaka office of a Sweden-based brand, speaking on condition of anonymity, said potential EU-US tariffs are unlikely to hurt Bangladeshi exports.

"We source around $250 million worth of products from Bangladesh each year, and our order flow remains normal – if anything, it may increase in the future," he said.

Similarly, the country manager of a Germany-based sportswear brand said the tariffs under discussion are selective and unlikely to affect Bangladesh directly. "However, it is still too early to say what the long-term consequences might be if such a situation persists."

Chinese capital Beijing's GDP exceeded 5.207 trillion yuan (about 743.79 billion U.S. dollars) in 2025, up 5.4 per cent year on year, surpassing the 5 trillion yuan mark for the first time, according to the municipal statistics bureau.

Oil prices were steady on Tuesday as investors monitored US President Donald Trump’s threats of higher tariffs on European states over his drive to acquire Greenland, while firmer global economic growth expectations and better-than-expected economic data from China gave a floor to prices.

Brent futures for March shed ‌11 cents, or 0.17 percent, at $63.83 a barrel at 0918 GMT, while ​the US West Texas Intermediate crude contract for February was down 49 cents, or 0.8 percent, at $58.95.

Trump’s tariff threats over Greenland will not have an immediate impact on the ‍oil balance, said PVM analyst Tamas Varga, adding that prices gained support from an upward revision of this year’s global economic growth estimate by the International Monetary Fund and stronger diesel prices.

Fears of a renewed trade war escalated over the weekend after Trump said he would impose additional ‍10 percent levies from February 1 on goods imported from Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland ‌and ‌Britain, rising to 25 percent on June 1 if no deal on Greenland was reached.

CHINA DATA SUPPORTS OIL

The oil market is also finding some support from better-than-expected fourth-quarter Chinese gross domestic product data released on Monday, said IG market analyst Tony Sycamore.

“This resilience in the world’s top oil importer provided a ​lift to demand sentiment,” he said.

China’s economy grew 5.0 percent last year, the data showed, while China’s in 2025 also climbed, edging up 4.1 percent year-on-year, while crude oil output grew 1.5 percent, data from ‍the world’s top oil importer showed on Monday.

Markets are also keeping a close eye on Venezuela’s oil sector after Trump said the US would run the industry after its capture of Nicolas Maduro.

Vitol offered Venezuelan ​oil to Chinese buyers at discounts of about $5 ‍per barrel to ICE Brent for April delivery, multiple trade sources said.

The dollar headed for its largest daily fall in over a month on Tuesday, after threats from the White House to Europe over the future of Greenland triggered a broad selloff across US stocks and government bonds, and drove the euro and the pound higher.

The dollar index , which measures the US currency's performance against a basket of six others, fell as much as 0.6 percent - marking its biggest one-day drop since mid-December - as investors worried about exposure to US markets.

On Monday, US President Donald Trump's renewed tariff threats against European allies triggered a repeat of the so-called "Sell America" trade that emerged after last year's "Liberation Day" tariff announcement in April, with stocks, Treasury bonds and the dollar all declining.

US markets will return on Tuesday following a public holiday for Martin Luther King Jr. Day.

Investors were dumping dollar assets on "fears of prolonged uncertainty, strained alliances, a loss of confidence in US leadership, potential retaliation and an acceleration of de-dollarisation trends," Tony Sycamore, market analyst at IG in Sydney, said.

"While there are hopes the US administration may soon de-escalate these threats, as it has with prior tariff announcements, it is clear that securing Greenland remains a core national security objective for the current administration," he added.

The euro rose 0.6 percent to $1.1719, while the pound gained 0.35 percent to trade at $1.3474. Sterling got a minor additional lift from UK labour market data that showed unemployment remained at a five-year high, but also offered positive signs such as vacancy numbers plateauing.

In terms of investor demand for euros, the "Sell America" effect could be short-lived, Barclays strategist Lefteris Farmakis suggested.
"Tariff threats are a marginal negative for the dollar in the near-term given long positions and still-low hedge ratios from a historical perspective. That said, major escalation with NATO spill-overs is a much bigger problem for the euro than Liberation Day," he said.

In its continued effort to stabilize the foreign exchange market and build up national reserves, Bangladesh Bank (BB) purchased an additional $45 million from two commercial banks on Tuesday (January 20).

The dollars were bought at a fixed exchange rate of Tk 122.30, with the cut-off rate also set at Tk 122.30, according to a press release issued by the central bank.

This latest transaction follows a series of significant dollar purchases by the central bank this month.

On January 12, purchased $81 million from 10 commercial banks.

On January 8, purchased $206 million from 15 commercial banks.

On January 6, purchased $223.5 million from 14 commercial banks.

All these transactions were conducted at the uniform rate of Tk 122.30 per dollar. With the latest purchase on Tuesday, the total dollar procurement for the month of January 2026 alone has reached $743 million.

Arif Hossain Khan, Executive Director and Spokesperson of Bangladesh Bank, confirmed the details of Tuesday’s transaction.

He noted that the aggressive buying strategy has significantly bolstered the country’s holdings during the current fiscal year.

Data reveals that during the first six months and twenty days of FY 2025-26 (from July 1 to January 20), the central bank has purchased a total of $3.87 billion (3,878.50 million) from the interbank market.

Market analysts suggest that the central bank is taking advantage of increased dollar inflows—likely from remittances and export earnings—to replenish the foreign exchange reserves, which had faced pressure in previous years. By maintaining a steady “cut-off” rate of Tk 122.30, the regulator is also signaling a desire for exchange rate stability, preventing abrupt fluctuations that could impact inflation and import costs.

The Bangladesh Bank purchased $743 million from commercial banks through auctions during the first 20 days of January, as part of its ongoing efforts to stabilise the exchange rate.

Confirming the matter, BB Executive Director and Spokesperson Arif Hossain Khan said the central bank bought $45 million from two commercial banks today (20 January) alone.

With the latest purchase, Bangladesh Bank's total dollar buying from commercial banks through auctions in the current fiscal year 2025-2026 has reached $3.88 billion.

Speaking to reporters at a seminar yesterday, BB Governor Ahsan H Mansur said commercial banks are voluntarily selling dollars to the central bank, which has increased liquidity in the market.

He added that the rise in dollar inflows has been a key factor behind the growth in bank deposits.

The governor also noted that higher dollar inflows have helped turn Bangladesh's balance of payments financial account into a surplus. As foreign currency supply increases, deposit growth in the banking sector is also expected to accelerate, he said.

The central bank began purchasing dollars through auctions from July last year as part of its foreign exchange market intervention strategy. Under the market-based exchange rate regime, the central bank aims to maintain balance in the foreign exchange market – allowing the dollar price to fall when supply exceeds demand, while letting it rise when demand increases.

Bankers say the recent decline in dollar demand is driven by several factors. The government's large external payment obligations have eased, reducing pressure on foreign currency demand.

At the same time, sluggish business activity and weak investment have led to lower imports of capital machinery, further easing demand for dollars, they said.

The Bangladesh Bank plans to create a dedicated "resolution fund" of up to Tk40,000 crore to rescue and restructure failing banks without relying on taxpayer-funded government bailouts.

Banks will have to contribute an annual premium of up to 0.25% or 25 paisa per Tk100 of their deposits, compared to the current 0.07% charged for the deposit insurance protection fund. Over time, the fund is expected to accumulate between Tk30,000 crore and Tk40,000 crore, enabling the central bank to intervene independently when banks face serious financial trouble.

In an interview with The Business Standard, Bangladesh Bank Governor Ahsan H Mansur said the initiative is inspired by the European Central Bank's resolution framework, under which banks deposit a portion of their deposits (approximately 1%) into a separate fund specifically for bank resolution.

"Bank resolution is a continuous process. That is why we have created a separate Bank Resolution Department," he said, explaining that the department continuously monitors banks and financial institutions, flags early signs of weakness, and intervenes when necessary through restructuring, mergers, or orderly liquidation.

The governor noted that five banks are currently under resolution, a process made possible only because the government provided around Tk20,000 crore in support.

Alongside the move, the Bangladesh Bank has decided to liquidate nine non-bank financial institutions (NBFIs), the governor said. As these entities are not covered by the deposit insurance protection fund, the government will provide Tk5,000 crore to repay individual depositors, he said.

The governor explained how the resolution fund will be built gradually. "If we raise the premium from 7 paisa per Tk100 of deposits to around 25 paisa, we can mobilise nearly Tk30,000 crore within five years. Once the fund becomes strong, provisioning requirements can be reduced."

Under the amended deposit insurance ordinance 2025, insured banks are required to deposit a premium of 0.07% per annum on their deposits. The new law states that the Bangladesh Bank will set the premium from time to time based on the bank's risk level and the size of deposits.

At the same time, banks and financial institutions will face penalty interest at the bank rate if they fail to pay the premium on time. The Bangladesh Bank will prevent the banks and financial institutions from accepting deposits that fail to pay the premium twice in a row.

How resolution fund to be operated

According to the Bank Resolution Ordinance, 2025, a bank restructuring and resolution fund will be established in order to achieve the objective of the resolution and effective implementation of the resolution measures.

It states that the Bank Restructuring and Resolution Fund will have a prudent and safe investment strategy and will invest the amounts held in the fund in obligations of the government.

The ordinance mentions that the Bangladesh Bank shall prescribe the rules governing such fund, including the power to manage, administer, and supervise the Bank Restructuring and Resolution Fund; formulate policies in relation to the general administration of the Bank Restructuring and Resolution Fund; and contribute to the financing of resolutions of scheduled banks from the Bank Restructuring and Resolution Fund.

What experts say

Experts have expressed mixed reactions to its long-term impact on banking discipline.

Muhammad A (Rumee) Ali, former deputy governor of Bangladesh Bank, cautioned that the fund could end up subsidising poor governance and weak risk management, as well-run banks would effectively support weaker ones.

However, Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue, welcomed the move, saying it would reduce pressure on taxpayers. He noted that similar mechanisms were introduced in Europe and the United States after the 2007 global financial crisis.

"Such a fund discourages risky lending and encourages responsible behaviour, even though some cost may be passed on to depositors," Mustafizur said.

Syed Mahbubur Rahman, managing director of Mutual Trust Bank, described the plan as aligned with global norms but warned that its success would depend on broader reforms. "With high non-performing loans, weak enforcement and political interference, the fund risks becoming symbolic unless governance, transparency and supervision are strengthened," he said.

Mahbubur added that the proposed levy is far lower than the ECB's 1% benchmark, raising concerns about its adequacy in a crisis. "Still, if transparently managed and scaled over time, it could be a solid starting point for building financial resilience."

Sohail RK Hussain, managing director of Bank Asia, also termed the initiative a positive and necessary step. "A resolution fund based on global best practices will strengthen financial stability and reduce reliance on taxpayer support," he said, stressing the need for gradual, transparent and risk-based implementation alongside deeper banking sector reforms.

"The proposed 0.25% annual cap, including insurance premium, is reasonable, especially considering the challenges the industry is facing," Sohail said.

He emphasised that the fund will be established on a transparent and risk-based basis.

"However, this should go hand in hand with the banking sector reform proposal, addressing governance failures of the past," the Bank Asia MD added.

All three major Wall Street indexes ended Tuesday with their biggest one-day drops in three months, in a broad selloff triggered by concerns ‌that fresh tariff threats from President Donald Trump against Europe could signal renewed market volatility.

The risk-off trade was pervasive, helping vault gold to fresh record highs, and pushing up debt costs with US Treasuries wobbling under renewed selling pressure. Bitcoin, which can find favor when traditional markets waver, fell more than 3%.

All three US equity benchmarks registered their worst one-day performance since 10 October, with both the S&P 500 and Nasdaq Composite slipping below their 50-day moving averages.

The S&P 500 lost 143.15 points, or 2.06%, to ‌end at 6,796.86 points, while the Nasdaq Composite gave up 561.07 points, or 2.39%, to 22,954.32. The Dow Jones Industrial Average fell 870.74 points, or 1.76%, to 48,488.59.

Uncertainty rises

Tuesday was the first opportunity for US investors to act on Trump's weekend comments, given the market holiday for Martin Luther King, Jr. Day.

This included Trump saying additional 10% import tariffs would take effect on 1 February on goods from Denmark, Norway, Sweden, France, Germany, ‌the Netherlands, Finland and Great Britain — all already subject to US tariffs.

The tariffs would increase to 25% on 1 June and continue until a deal was reached for the US to purchase Greenland, Trump wrote in a post on Truth Social. Leaders of Greenland, an autonomous territory of Denmark, and Denmark have insisted the island is not for sale.

The reinjection of ⁠tariff threats into global markets harkens back to April's "Liberation Day," when Trump's levies on global trade partners pushed the S&P 500 to near bear market territory.

The ‍CBOE Volatility Index, also known as Wall Street's fear gauge, spiked to 20.09 points, its highest close since 24 November.

Trading volumes were also higher: around 20.6 billion shares changed ‌hands on ‌US exchanges on Tuesday, up from the 17.01 billion average for the last 20 trading days.

While investor sentiment was frayed on Tuesday, the question being asked is whether Greenland represents a knee-jerk selloff, or something that will have longer-term implications for markets.

Jamie Cox, managing partner at Harris Financial Group, said he was not seeing indications investors were fleeing.

"I'm not at the point yet where I'm willing to say what is happening with Greenland, and the resurgence of the tariff threat back ⁠and forth, is going to precipitate a ⁠correction in the equities markets," he said, adding he would be surprised if there was a 3% to 5% drop this week.

Bond markets spillover

A potentially more significant action, in Cox's eyes, would be whether Japanese authorities intervene in financial markets.

Japanese government bonds plunged on Tuesday, sending yields to record highs, while Tokyo stocks and the yen also fell after Prime Minister Sanae Takaichi's call for a ‍snap election shook confidence in the country's fiscal health.

The moves helped push the cost of longer-term European government bonds higher, while a selloff in US Treasuries was more pronounced on the long end of the curve.

Despite tariff talk, and notable bond movements, the US economy remains in a strong position.

Investors are due a host of fresh data this week on the state of the US economy, including the third-quarter US GDP update, January PMI readings and the Personal Consumption Expenditures ‍report, which is the Federal Reserve's preferred inflation gauge.

Earnings season is also kicking into higher gear, with several industry bellwethers set to report their quarterly earnings this week.

Among them was Netflix, which closed 0.8% lower before reporting earnings after the bell.

Another consignment of 57,203 tonnes of wheat from the United States has arrived at Chittagong Port.

The vessel MV Clipper Isadora, carrying the wheat from the US, arrived at the outer anchorage of the port today (19 January), reads a press release.

The shipment has been imported under a cash purchase agreement (G to G-02) signed in line with a memorandum of understanding (MoU) between the governments of the United States and Bangladesh.

Under the G to G-02 agreement, a total of 220,000 metric tonnes of wheat will be imported. The MV Clipper Isadora represents the second consignment under this agreement. Earlier, 56,890 metric tonnes of wheat arrived in the country as the first shipment.

Of the 57,203 metric tonnes carried by the vessel, 34,320 metric tonnes will be unloaded at Chattogram Port, while the remaining 22,443 metric tonnes will be discharged at Mongla Port.

Meanwhile, under the earlier G to G-01 agreement, Bangladesh has already imported a total of 220,000 metric tonnes of wheat.

Bangladesh Bank Governor Ahsan H Mansur has expressed strong confidence in the country’s ability to meet or exceed its $35 billion foreign exchange reserve target for the current fiscal year—without depending on International Monetary Fund (IMF) disbursements.

He made the remarks while addressing a seminar titled “Understanding the Pulse of the Economy Through the Purchasing Managers Index (PMI)” jointly organised by the Metropolitan Chamber of Commerce and Industry (MCCI) and Policy Exchange Bangladesh at the MCCI office in Dhaka this evening.

“This will be a very comfortable level of reserve—and that too, without the IMF money,” Mansur said. “If anything comes from the IMF, it will be icing on the cake, not a necessity.”

Mansur said the macroeconomic consolidation process is ongoing and significant improvements have been made on the balance of payments and reserve fronts.

Despite challenges in exports, he highlighted gains in terms of trade due to declining global energy prices. “Import volume has increased even though payment has risen only 5-6 percent. This reflects a 30 percent drop in petroleum prices, which has translated into strength on our external side,” he added.

Chattogram Port data also show a substantial rise in import volumes—both in tonnage and container traffic—indicating robust trade activity.

The governor emphasised that Bangladesh Bank is closely monitoring a range of high-frequency indicators, such as daily exchange rates, remittance flows, interest rates, and reserve levels.

He also acknowledged the importance of newly introduced tools such as the Purchasing Managers Index (PMI), calling it a “welcome addition” to the country’s economic monitoring arsenal.

Touching on domestic liquidity conditions, Mansur pointed out that deposit growth rose from 6.4 percent in December 2022 to 11 percent in December 2023, with total deposits reaching Tk 20 trillion.

“This translates to an additional Tk 2.2 trillion in liquidity. After accounting for government borrowing, over Tk 1.2 trillion is now available for private sector credit,” he said.

He expects deposit growth to rise further to 14 percent, backed by a surplus in the balance of payments and buildup of net foreign assets—further easing liquidity pressures in the banking sector.

Mansur signaled that the lending rate to prime borrowers has already dropped by nearly 2 percentage points, ranging between 11-12 percent.

He reiterated that sustained improvement in inflation, currently above 8 percent, is critical before policy rates can be relaxed further.

“As soon as inflation drops by over 1 percentage point, we will begin rolling back the policy rate,” he stated.

Highlighting past support to the private sector amid multiple shocks—including COVID-19, exchange rate volatility, and political transitions—the governor said 1,500 out of 3,300 applications for loan restructuring have already been processed.

He warned against “shortcuts” in monetary policy that could jeopardise hard-earned stability, particularly in the foreign exchange market.

“We must not abandon a working strategy due to impatience,” he said.

The governor also emphasised Bangladesh Bank’s ongoing efforts to liberalise the foreign exchange market, including facilitating the international expansion of Bangladeshi businesses.

India's central bank has proposed that BRICS countries link their official digital currencies to make cross-border trade and tourism payments easier, two sources said, which could reduce reliance on the US dollar as geopolitical tensions rise.

The Reserve Bank of India (RBI) has recommended to the government that a proposal connecting the central bank digital currencies (CBDCs) be included on the agenda for the 2026 BRICS summit, the sources said. They requested anonymity because they were not authorised to speak publicly.

India will host the summit, which will be held later this year. If the recommendation is accepted, a proposal to link the digital currencies of BRICS members would be put forward for the first time. The BRICS organisation includes Brazil, Russia, India, China and South Africa, among others.

The initiative could irritate the US, which has warned against any moves to bypass the dollar.

US President Donald Trump has previously said the BRICS alliance is "anti-American" and he threatened to impose tariffs on its members.

The RBI, India's central government and the central banks of Brazil and Russia did not respond to emails seeking comment. The People's Bank of China said it had no information to share on the subject in response to a Reuters request for comment; the South African central bank declined to comment.

The RBI's proposal to link BRICS' CBDCs for cross-border trade finance and tourism has not been previously reported.

Building bridges

The RBI's proposal builds on a 2025 declaration at a BRICS summit in Rio de Janeiro, which pushed for interoperability between members' payment systems to make cross-border transactions more efficient.

The RBI has publicly expressed interest in linking India's digital rupee with other nations' CBDCs to expedite cross-border transactions and bolster its currency's global usage. It has, however, said its efforts to promote the rupee's global use are not aimed at promoting de-dollarisation.

While none of the BRICS members have fully launched their digital currencies, all five main members have been running pilot projects.

India's digital currency — called the e-rupee — has attracted a total of 7 million retail users since its launch in 2022 December, while China has pledged to boost the international use of the digital yuan.

The RBI has encouraged the adoption of the e-rupee by enabling offline payments, providing programmability for government subsidy transfers and by allowing fintech firms to offer digital currency wallets.

For the BRICS digital currency linkages to be successful, elements like interoperable technology, governance rules and ways to settle imbalanced trade volumes would be among the discussion topics, one of the sources said.

The source cautioned that hesitation among members to adopt technological platforms from other countries could delay work on the proposal and concrete progress would require consensus on tech and regulation.

One idea that is being explored to manage potential trade imbalances is the use of bilateral foreign exchange swap arrangements between central banks, both the sources said.

Previous attempts by Russia and India to conduct more trade in their local currencies hit roadblocks. Russia accumulated large balances of the Indian rupee for which it found limited use, prompting India's central bank to permit the investment of such balances in local bonds.

Weekly or monthly settlements for transactions are being proposed to be made via the swaps, the second source said.

Long road

Founded in 2009 by Brazil, Russia, India and China, BRICS later expanded to include South Africa and has since broadened further, adding newer members like the United Arab Emirates, Iran and Indonesia.

The bloc has returned to the limelight thanks to Trump's revived trade-war rhetoric and tariff threats, including warnings aimed at countries aligning with BRICS. At the same time, India has edged closer to Russia and China as it faced trade friction with the US.

Past efforts to turn BRICS into a major economic counterweight have run into hurdles, including an ambition to create a common BRICS currency, an idea that was floated by Brazil but was subsequently nixed.

While interest in CBDCs has been dampened globally by rising stablecoin adoption, India continues to position its e-rupee as a safer, more regulated alternative.

CBDCs "do not pose many of the risks associated with stablecoins," RBI Deputy Governor T Rabi Sankar said last month.

"Beyond the facilitation of illicit payments and circumvention of control measures, stablecoins raise significant concerns for monetary stability, fiscal policy, banking intermediation and systemic resilience," Sankar said.

India fears widespread stablecoin use could fragment national payments and weaken its digital payments ecosystem, Reuters reported in September.

The stock market regulator has rejected bond issuance proposals worth Tk 2,100 crore from several banks that had earlier received no-objection certificates from the Bangladesh Bank (BB).

According to official documents from earlier this month, Southeast Bank, Al-Arafah Islami Bank, Meghna Bank, and One Bank are among the lenders whose bond proposals were rejected.

BB, the regulator of the banking sector, had earlier issued no-objection certificates after assessing the banks’ capital adequacy and leverage position, liquidity profile, asset quality, stress-test outcomes, repayment capacity, and governance standards.

However, the Bangladesh Securities and Exchange Commission (BSEC) said it rejected the proposals because the banks’ “financial performance, particularly liquidity and profitability, is not satisfactory”.

A no-objection certificate from the BB is a mandatory requirement for banks seeking to issue bonds, but it does not guarantee approval by the stock market regulator.

“After the merger of five banks, there is growing fear that bond subscribers could lose their invest-ments if a bank’s financial condition deteriorates,”
Saiful Islam, President of the DSE Brokers Association of Bangladesh
According to a senior merchant banker, the central bank’s NOC signals that a bond proposal complies with prudential regulations and does not pose systemic risk to the banking system.

“It means the proposal has passed the most critical checkpoint for banking stability,” he said, adding that BB focuses mainly on whether a bond could weaken a bank or create broader financial stress.

The BSEC, by contrast, assesses the proposal from the perspective of the capital market, with emphasis on investor protection, disclosure quality, cash flow, and the issuer’s ability to repay bondholders on time, said the banker, preferring anonymity.

He said subordinated bonds are an important tool for banks to strengthen tier-2 capital without diluting equity, improve maturity matching, and reduce reliance on short-term deposits.

“At a time when many banks are undergoing leadership changes, balance sheet clean-ups, and operational restructuring, bond financing can provide breathing space for a sustainable turnaround,” he said.

Capital market representatives, however, defended the BSEC’s cautious approach.

Saiful Islam, president of the DSE Brokers Association of Bangladesh (DBA), said the recent merger of five banks had heightened risks for bondholders, as merger schemes addressed depositor interests but offered no clear protection for bond investors.

“After the merger of five banks, there is growing fear that bond subscribers could lose their investments if a bank’s financial condition deteriorates,” he said.

Islam also criticised credit rating agencies, saying they had failed to reflect the true financial health of banks, leaving bond investors exposed.

“Usually, investors rely on credit ratings when subscribing to bonds. But the rating agencies did not properly capture the risks,” he said, adding that bond approvals should therefore be handled with greater scrutiny in the public interest.

He said that banks whose bond proposals were rejected might face short-term pressure, but they should consider raising capital through equity injection instead.

BSEC Spokesperson Abul Kalam said obtaining a no-objection certificate from the BB is only one of several conditions for bond approval.

“It does not mean that if the central bank gives an NOC, the BSEC must approve the bond,” he told The Daily Star.

He said the commission approves debt securities in line with its own rules and regulations, and may reject proposals if a bank’s financial performance and cash flow are weak.

“If cash flow is not satisfactory, the bank may face difficulties in repaying bondholders. That risk has to be assessed independently,” he added.

Bangladesh Bank Spokesperson Arif Hossain Khan said each regulator has a different perspective and operates within its own mandate. “The decision not to approve some bonds is entirely the BSEC’s consideration, and it has the authority to do so,” he said.

Contacted, Khwaja Shahriar, chairman of Al-Arafah Islami Bank, whose bond issuance proposal was rejected by the stock market regulator, said the bank had been on a steady recovery path since the board was reconstituted.

He said liquidity conditions have improved, and the bank’s overall financial position is strengthening gradually.

“We seek the continued support of the BSEC and firmly believe they will assist us in further strengthening the institution’s strength for the sake of national development,” he added.

Payra Port, conceived as Bangladesh's third seaport to reduce dependence on Chattogram and lower logistics costs, is edging towards functional irrelevance as stalled maintenance dredging has silted up its access channel, sharply reducing ship calls.

The consequences are now adding to port congestion, raising power generation costs at two coal-based plants, and exposing serious gaps in infrastructure planning.

Port data shows that in the first half of FY26, only 17 foreign mother vessels called at Payra, down from 111 in FY23 and 123 in FY24. Even in FY25, when traffic had begun to taper, the port handled 85 ships.

The decline is striking given that more than Tk6,500 crore was spent on capital dredging to make Payra accessible to large vessels. Barely a year after completion, big ships are again unable to enter the seaport.

The problem lies in the Rabnabad channel, where heavy siltation has reduced navigable depth.

Officials said the draft has fallen to around 6.5 metres, down from the designed 10.5 metres, effectively barring large vessels and negating the benefits of capital dredging.

Coal ships supplying the Payra Thermal Power Plant and Norinco International Power Limited (RNPL) now unload at Chattogram's outer anchorage. The coal is then brought to Payra via lighter vessels, a slow, costly, and increasingly unsustainable workaround.

Additional lightering strains an already stretched system and has raised electricity generation costs by as much as Tk0.70 per unit, feeding into higher energy prices for consumers.

Payra Port officials blame the crisis on the absence of approved maintenance dredging following the 2024 capital dredging. Over the past year, unchecked siltation has steadily reduced channel depth.

A Tk6,500 crore maintenance dredging project has remained stuck at the proposal stage for nearly a year, officials said, citing the interim government's reluctance to approve major new projects.

Mohammad Jamal Uddin Chowdhury, member (harbour and marine) of the Payra Port Authority, said continuous maintenance dredging was essential immediately after capital dredging.

"That approval didn't come," he told The Business Standard. "As a result, siltation reduced navigability, preventing mother vessels with 8-10.5 metres draught from entering. Coal ships for the power plants now have to unload at Chattogram and be brought here through lightering."

He added that the authority plans to undertake both capital and maintenance dredging and has initiated steps to procure two trailing suction hopper dredgers (TSHDs) to maintain channel depth year-round.

The proposal, however, is still awaiting approval, delayed partly by the election period and the interim government's reluctance to take major policy decisions, said Jamal Uddin.

However, Shipping Adviser Shakhawat Hossain told TBS that delays in submitting the maintenance dredging proposal had worsened the situation.

"A hopper dredger will be required for this work, and procuring one takes time," he said. "The Payra Port Authority is now preparing a fresh proposal, which will take additional time."

On the port's prospects, he said it was too early to say.

Coal ships diverted via Chattogram, costs climb

During FY24, while capital dredging was underway, Payra regularly handled vessels with drafts of around 10 metres, carrying 40,000 to 45,000 tonnes of coal. At times, 12 to 14 coal ships berthed each month.

Now, large carriers are anchored at Kutubdia or Chattogram's outer anchorage, unloading cargo via lighter vessels in batches of 5,000 to 6,000 tonnes to the jetties of Payra Thermal Power Plant and RNPL.

"Big ships can't berth here anymore," said Jobaer Ahmed, superintendent engineer of the Payra Plant. "The plant requires around 300,000 tonnes of coal monthly. Earlier, seven to eight mother vessels handled this directly at our jetty. Now over 200 lighterage vessels are needed."

He added that cranes designed for large ships struggle with smaller lighter vessels. "The process is slow and costly," he said, noting electricity production costs have risen by around Tk0.70 per unit.

Revenue pressure, levy proposed

Since commercial operations began in August 2016, Payra Port has handled 5,338 vessels, including 544 foreign ships, generating around Tk1,861.82 crore in government revenue up to 31 December 2025.

With foreign calls falling, revenue pressure is mounting. To fund dredging, the PPA has proposed an annual Tk700 crore levy on its two largest users – the 1,320MW Payra Thermal Power Plant and RNPL.

Together, the plants consume around 12,000 tonnes of coal daily, importing nearly 10 million tonnes annually, making uninterrupted maritime access critical.

"Our income has definitely declined," Jamal Uddin Chowdhury said. "Without a stable dredging mechanism, this situation will persist."

Big vision, unfinished port

Launched in 2013, Payra was initially conceived as a deep-sea port. The plan was later revised as a standard seaport, 65km inland at the mouth of the Rabnabad channel.

The Payra Port Authority was established under the 2013 Act. Feasibility studies were conducted by British consultancy HR Wallingford, and the masterplan prepared by Dutch firm Royal Haskoning in 2019.

Ships began calling at the outer anchorage that year. Since then, 5,338 domestic and foreign vessels have used the port, generating about Tk267 crore in revenue for the port until December 2025.

Payra remains under construction, with completion scheduled for December 2026. Work continues on terminal equipment, administrative and customs buildings, warehouses, and a six-lane road. Full operations, initially planned for July, are now likely to be delayed until January 2027 due to lack of dredging approval.

The growing threat of a renewed trade war between the United States and the European Union is stoking fears among Bangladeshi garment exporters that retaliatory tariffs could trigger global supply chain volatility and suppress consumer demand in their most vital markets.

Industry insiders say any escalation of tariff measures between the two economic blocs could trigger fresh inflation in the US and Europe, reducing consumer spending and, in turn, demand for Bangladeshi apparel. Such a scenario could further strain exports.

Data show that Bangladesh's overall exports, including readymade garments, have been declining for five consecutive months, while prices in the European market have also softened during the period.

Representatives of foreign buyers sourcing from Bangladesh, however, believe the immediate impact of any new tariff measures would be limited, although prolonged trade tensions could create uncertainty over the longer term.

According to a report by The Guardian, the EU's top diplomats met for crisis talks on Sunday (18 January) and discussed reviving a plan to levy tariffs on €93 billion ($108 billion) of US goods, which was suspended after last year's trade deal with Trump.

In a post on Saturday on Truth Social, US President Donald Trump said he would impose a 10% tariff on Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland beginning 1 February.

Media reports also said Trump threatens a 25% tariff on European allies until Denmark sells Greenland to the US.

Experts warn that such tariff disputes could destabilise not only transatlantic trade but the wider global trading system.

MA Rahim Feroz, vice-chairman of DBL Group – one of Bangladesh's largest apparel exporters with annual turnover exceeding $1 billion – told TBS that higher tariffs in Europe or the US would inevitably lead to inflation.

"If inflation rises, consumers will buy less, which will put significant pressure on us and negatively affect Bangladesh's exports to those markets," he said.

Echoing Feroz, Md Shehab Udduza Chowdhury, vice president of the Bangladesh Garment Manufacturers and Exporters Association, warned that imports could be affected if trade tensions intensify.

In 2025, Bangladesh exported garments worth $38.82 billion globally, with nearly 80% destined for the European Union, the US and the UK.

Exporters say Bangladesh has already felt the impact of reciprocal tariffs imposed by the Trump administration, with shipments to both the US and Europe coming under strain. They add that garment prices in the European market have declined as a result.

Feroz noted that after the US imposed higher tariffs on China and India than on Bangladesh, the two larger exporters stepped up efforts to sell more in Europe, intensifying competition and forcing Bangladeshi exporters to offer price discounts.

An analysis of Eurostat data by the Bangladesh Apparel Exchange shows that the average price of Bangladeshi apparel exported to Europe fell by 2.06% between January and September 2025. Prices of apparel from other major exporting countries also declined during the same period.

Trade experts see little upside for Bangladesh if a trade war erupts between Europe and the US.

Mostafa Abid Khan, an international trade expert and former member of the Bangladesh Trade and Tariff Commission, said he does not foresee any major short-term disruption to Bangladesh's exports or imports.

Before the latest tariff announcements, US tariffs on EU goods ranged from zero to 15%, while UK exports to the US faced a 10% tariff. US goods entering the UK are subject to a 6% tariff, and EU data show that a significant number of US products have enjoyed duty-free access to the EU since August.

Buyers remain unconcerned

Despite exporters' worries, foreign buyers say their sourcing from Bangladesh remains unaffected.

A senior official at the Dhaka office of a Sweden-based brand, speaking on condition of anonymity, said potential EU-US tariffs are unlikely to hurt Bangladeshi exports.

"We source around $250 million worth of products from Bangladesh each year, and our order flow remains normal – if anything, it may increase in the future," he said.

Similarly, the country manager of a Germany-based sportswear brand said the tariffs under discussion are selective and unlikely to affect Bangladesh directly. "However, it is still too early to say what the long-term consequences might be if such a situation persists."

The dollar fell on Monday as investors unnerved by ​US President Donald Trump's latest tariff threats against Europe over Greenland piled into the safe-haven yen and Swiss franc, ‌in a broad risk-averse move across markets.

Trump said over the weekend he would impose an additional 10 percent import tariff from February 1 on goods from Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland and Britain, until the United States is allowed to buy Greenland.

Major European Union nations decried the Greenland tariff threats as blackmail on Sunday, with France proposing to respond with a range of previously untested economic countermeasures.

In the foreign exchange market, the knee-jerk reaction in ‌early Asia trade was to sell the euro and sterling , pushing the currencies to a seven-week low of $1.1572 ​and a one-month trough of $1.3321, respectively.

As the trading day got underway, both bounced from their lows, however, with the dollar coming under pressure as investors assessed the longer-term implications of Trump's latest move on the greenback.
That helped the euro reverse its losses, gaining 0.3 percent to trade ‍at $1.1634, while the British pound similarly recovered 0.16 percent to $1.3397.

"Typically you would think tariffs being threatened would lead to a weaker euro," said Khoon Goh, head of Asia research at ANZ.

"But, as we've seen last year as well, when the 'Liberation Day' tariffs were getting put in place, the impact in FX markets actually has ⁠been more towards dollar weakness every time there is heightened policy uncertainty emanating from the United States."

Investors had dumped the dollar after Trump ‍unveiled sweeping tariffs on the world last April, triggering a crisis of confidence in US assets.

A similar trend played out on Monday, as the greenback slid ‌0.45 percent against ‌the safe-haven Swiss franc to 0.7985, and was down 0.21 percent at 157.77 yen.

Bangladesh Bank (BB) Governor Dr. Ahsan H. Mansur on Monday expressed strong optimism regarding the country’s macroeconomic stability, projecting that foreign currency reserves are on track to meet and surpass US$35 billion by the end of the current fiscal year 2025-26 (FY26).

“Reaching the $35 billion mark would establish a very comfortable level for the economy,” he said while speaking at a seminar on “Systematic Efforts to Understand Economic Pulse: Importance of Purchasing Managers’ Index (PMI)” at Metropolitan Chamber of Commerce and Industry (MCCI) office in the city.

MCCI and Policy Exchange Bangladesh (PEB) jointly organised the seminar.

In his speech, Ahsan H. Mansur clarified that this target is expected to be met without relying on IMF money, stating that any additional external funding would simply be icing on the cake rather than a necessity for hitting the target.

The governor highlighted significant progress in the balance of payments and the external sector.

While acknowledging that the export sector is currently facing headwinds and remains a weak point, the governor pointed to favourable developments in global import prices.

He noted that the country has achieved terms of trade gains due to significantly reduced energy prices and generally stable or declining commodity prices.

“If you look at petroleum price for example the price average decline is about 30%,” the Governor stated, adding that this reduction represents a direct gain for the economy.

Consequently, while import payments have increased by approximately 5% to 6% this year, the actual volume of imports has risen much more significantly, he added.

He said this growth in volume is corroborated by data from the Chittagong port, which indicates strong increases in both tonnage and container numbers.

The governor addressed the very difficult liquidity situation the banking sector previously faced, which began with a shortage of foreign exchange.

He revealed that the central bank had to settle accumulated arrears totalling approximately $3.5 billion.

The Governor explained that a prior drop in reserves from $48 billion to $20 billion had caused a massive contraction in the money supply, with trillions of taka leaving the country.

This led to a severe deceleration in deposit growth, which stood at only 6.4% as of December 2024, creating a scarcity of funds for private sector financing, he added.Import financing solutions

The Governor cited recent data showing that deposit growth has rebounded to 11%.

“With total deposits now standing at approximately 20 trillion taka, this growth rate translates to an influx of roughly 2.2 trillion taka into the system,” he added.

Emphasizing the importance of real-time analytics, the Governor remarked that policymakers do not have a crystal ball and must rely on high-frequency data—such as daily exchange rates, interbank interest rates, and remittance flows—to make decisions.

He shared positive news regarding remittances, noting that daily collection had recently topped $170 million, and monthly figures were tracking at roughly 70% of the previous month’s total at the time of the speech.

The governor also welcomed the introduction of the Purchasing Managers’ Index (PMI) as a new kid in town, thanking the MCCI and Policy Exchange for the initiative, noting that the addition of such indicators aids in the art of policymaking.

Deputy High Commissioner and Development Director, British High Commission to Bangladesh James Goldman attended the seminar as the special guest while MCCI President Kamran T. Rahman delivered the welcome speech.

PEB Chairman and CEO Dr. M. Masrur Reaz delivered the keynote presentation while Head of Prosperity and Economic Growth, FCDO Issam Mosaddeq delivered the Contextual Background on PMI.

The government has decided to sell properties owned by Nassa Group to clear outstanding wages and service benefits for its workers, Labour and Employment Adviser M Sakhawat Hussain said on Sunday.

A sale of assets will be carried out in accordance with court directives, the adviser said at an Advisory Council Committee meeting on reviewing conditions of industrial units in Beximco Industrial Park, held at the Secretariat.

Nassa Group has so far paid Tk 76 crore to workers by selling company shares through a court-appointed administrator, a ministry press release quoted him as saying.

The group has also made down payments to eight banks under instructions from the Bangladesh Bank.

Remaining payments to another 15 banks and the settlement of outstanding worker arrears will be addressed through the sale of Nassa Group assets via open and competitive processes, following court guidance.

The group, which employed more than 30,000 workers in textile and garment operations and also has stakes in banking and real estate, faced financial turmoil after its chairman, Nazrul Islam Mazumder, was arrested in October 2024 over a murder case linked to the July uprising.

Media reports indicate that most of Nassa’s operations have remained paralysed since the change of government in August 2024, with factories shuttered and unpaid bank loans mounting to several thousand crore taka.

Earlier, the Bangladesh Financial Intelligence Unit alleged Mazumder’s involvement in trade-based money laundering worth about Tk 16,000 crore, including Tk 4,717 crore reportedly siphoned from EXIM Bank through 18 shell companies during his tenure as chairman from 2007 to August 2024.

Inflow of remittances witnessed a year-on-year growth of 69 percent reaching US$2,040 million in the first 18 days of January, according to the latest data of Bangladesh Bank (BB) issued on Monday.

Last year, during the same period, the country’s remittance inflow was $1,207million.

During the July to January 18, 2026 of the current fiscal year, expatriates sent remittances of $18,305 million, which was $14,983 million during the same period of the previous fiscal year.