How the dollar rate is set: bid, ask and the average rate

“What is the dollar rate today?” has more than one answer. Bangladesh Bank’s rate, banks’ customer rates and the cash dollar on the street all differ. Here is what each one means.

A market-based exchange rate

In May 2025 Bangladesh Bank announced that the dollar’s price would from then on be set by the market: by the supply of and demand for dollars. Under the earlier “crawling peg”, the central bank fixed a mid-rate. Now banks buy and sell dollars among themselves (the interbank market), and Bangladesh Bank publishes a daily reference rate from those trades. If the market turns volatile, the central bank can step in by selling or buying dollars.

Bid, ask and the average rate

Bangladesh Bank’s exchange rate page shows three numbers for the US dollar:

• Bid: the interbank buying rate.
• Ask: the interbank selling rate.
• WAR (weighted average rate): the average of the day’s actual interbank deals, weighted by their size. It is the best single number for “the price of the dollar” that day.

bdrate.fyi’s dollar rate page shows this average rate as the headline, with bid and ask beside it. Bangladesh Bank publishes on working days; on holidays the last working day’s rate stands.

Why banks’ rates differ

For customers, each bank sets its own buying and selling rates, close to the interbank rate:

• Buying rate (e.g. TT clean): what the bank pays you for dollars, such as remittance or export earnings.
• Selling rate (e.g. BC selling): what the bank charges you for dollars, such as for imports or sending money abroad.

The buying rate is usually a little lower and the selling rate a little higher; the gap is the bank’s income. Cash dollars from money changers or the kerb market can be different again.

Other currencies

Bangladesh Bank also publishes bid and ask for the euro, pound, rupee, yen and a few more. The Saudi riyal and UAE dirham are not on its list, but both are fixed to the US dollar (USD 1 = SAR 3.75 = AED 3.6725). Divide the dollar rate by that number and you have the riyal or dirham in taka; the currency pages work it out that way.

Why the rate moves

• Supply: more remittance and export earnings bring more dollars in.
• Demand: higher import bills and foreign debt payments need more dollars.
• The central bank: selling or buying dollars from the reserves, and the policy interest rate.

Putting it to use

• Send money home through formal channels (banks or licensed services); a government incentive applies there.
• To work out a sum in advance, use the currency converter, but get the final rate from your bank.

Sources

• Bangladesh Bank: exchange rate of taka
• Bangladesh Bank’s announcement of the market-based exchange rate and news reports of it (The Daily Star, May 2025)