Call money rate hits 7% for first time in over 6 years

Banks hiked interest rates on overnight loans by 25 basis points to a maximum of 7%. The hike was verbally instructed by the central bank, managing directors of several banks told The Business Standard. However, Bangladesh Bank Executive Director and Spokesperson Md Mezbaul Haque told TBS that he did not know about any such instruction, adding that the central bank has no role in hiking the call money market. He said the rate is increasing due to rising liquidity demand in the market. These rates tend to be slightly upward if there is inflationary pressure, which is what is happening here, he added. Before Tuesday, banks could lend money to other banks at a maximum rate of 6.75% as set by the central bank. With the latest hike, the Bangladesh Bank has increased the overnight lending rate by 125 basis points in two steps this month alone. The interest rate at which one bank lends money to another for a day is called call money rate. Banks treat loans for more than a day as short notice loans. The call money market comprises both day-long and more than a day-long loans.

Source: https://www.tbsnews.net/economy/banking/call-money-rate-hits-7-first-time-over-6-years-574082

Three more firms get land in economic zone

Bangladesh Economic Zones Authority (BEZA) has signed land lease agreements with three organisations. The organisations are: Bangladesh Industrial Technical Assistance Centre (BITAC), Swan International (Pvt) Ltd and Pinnacle Bicycle. BEZA Executive Member (Investment Development) Md Ali Ahsan, Swan International (Pvt) Ltd Managing Director Md Amzad Khan, Pinnacle Bicycle Md Iftekhar Khan and BITAC Director General Anwar Hossain Chowdhury signed the agreements on behalf of their respective organisations at a function at BEZA conference room in Dhaka. BEZA Executive Chairman Sheikh Yusuf Harun was present on the occasion, reports BSS citing a press release. According to BEZA, Swan International (Pvt) Ltd and Pinnacle Bicycle will set up tire and bicycle factories with an investment of US$35.14 million. On the other hand, BITAC will set up a technical training institute. Swan International placed an investment proposal of $13.18 million to set up a tire manufacturing plant on 10 acres of land in the Bangabandhu Sheikh Mujib Shilpa Nagar in Chattogram’s Mirsarai. The plant would create employment opportunities for around 1,000 people.

Source: https://thefinancialexpress.com.bd/economy/three-more-firms-get-land-in-economic-zone-1674651829

BD-Korea bilateral trade reaches record high

The bilateral trade volume between Korea and Bangladesh has reached another record high in 2022 exceeding 3.0 billion US dollars. According to the statistics of the Korea International Trade Association, the bilateral trade volume in 2022 recorded USD 3.035 billion, a 38.71 per cent increase from 2021 which was USD 2.188 billion. Bangladesh’s export to Korea increased by 22.9 per cent to USD 678 million in 2022 from USD 552 million in the previous year while Korea’s export to Bangladesh rose by 44.10 per cent with USD 2.357 billion in 2022 from USD 1.636 billion in 2021. Bangladesh’s export to Korea has been continuously increasing since it crossed for the first time USD 100 million in 2007 and reached USD 200 million in 2011 and USD 300 million in 2013. But it had remained stagnant for about a decade then after and shrunk by 2.9 per cent in 2020 recording USD 393 million due to the adverse impact of the COVID-19 pandemic. However, it witnessed a big rebound in 2021 to USD 552 million with a sharp increase of 40.40 per cent year-on-year and recorded another record high of USD 678 million in 2022 with a 22.9 per cent year-on-year increase. The main export items of Bangladesh to Korea are RMG, sports and leisure items and bronze scraps, etc. RMG which accounts for 83.20 per cent of total export to Korea recorded USD 564 million in 2022, increasing 25.8 per cent year-on-year, while paper products and favourite food skyrocketed by 168.60 per cent and 165 per cent with USD 3.6 million and USD 3.1 million respectively. The export of bronze scrap rose by 41.8 per cent with USD 17.76 million.

Source: https://thefinancialexpress.com.bd/trade/mrt-1-construction-groundbreaking-event-on-feb-02-1674443253