In 1999. Bangladesh Taka was adjusted downward by 5.0922 per cent against US dollar. The first devaluation was done on July 18. 1999 by BDT 1 or 2.06 per cent and the second one on November 30, 1999 by BDT 1.50 or 3.03 per cent.

Bangladesh Bank's dollar buying and selling rates closed at BDT 50.85 and BDT 51.15 respectively on December 31.1999. The commercial banks' US dollar buying rates from the exporters closed at around BDT 50.65 while the dollar selling rate to importers hovered at around BDT 50.82.

In the local foreign exchange market, demand for the US dollar was high during the first three quarters due to higher Import payments and other outward remittances. Interbank dollar selling rates hovered close to Bangladesh Bank's selling rate.

In the last quarter, the demand for US dollar was comparatively lower, due to lower import payments and higher inward remittances in the form of foreign currency loan and aid. Most of the trade-related transactions were in US dollar, while inward remittances received as aid or donations were in European currencies.

The local money market was more or less easy throughout the year due to surplus liquidity. However, the first half was a bit lighter than the second one. Most of the commercial banks witnessed surplus in funds due to decline in private lendings and government borrowings.

Treasury bills played pivotal role in the money market. The weekly auction was held on Sunday and payments against accepted bids and matured bills were made Monday. Yield on treasury bill declined throughout the year. Bangladesh Bank lowered its rate by 100 basis points to 7 per cent.

The market expects the local foreign and money market to the hectic in 2000 on account of growing business and spurring economic activities.

—Standard Chartered Bank.