Checking the USD to BDT rate used to be a weekly chore for most people. Now? It's a daily ritual, often involving several refreshes of a browser tab. If you’ve sent money home or tried to pay for a software subscription from Dhaka recently, you know the vibe. It’s volatile. Honestly, it’s kinda stressful.
As of mid-January 2026, the rate is hovering around 122.46 BDT per 1 US Dollar.
Just a few days ago, it was sitting comfortably near 120.75. That sudden jump isn't just "market noise." It’s the result of a massive shift in how Bangladesh manages its money. We’ve moved away from the old days of the central bank strictly "fixing" the price. Now, we are deep into the era of the crawling peg and a slow march toward a truly flexible exchange rate.
Why the USD to BDT rate is jumping right now
Money is flowing in, but the price is still going up. It seems backwards, right? Bangladesh Bank reported that remittance inflows soared by over 81% in the first eleven days of January 2026 compared to last year. We're talking about $1.33 billion hitting the economy in less than two weeks. Usually, when that much foreign currency floods the market, the local currency gets stronger.
But the Taka isn't getting stronger.
The reality is that the "official" rate is finally catching up to the "market" rate. For years, the gap between what the bank said a dollar was worth and what you actually paid at a money changer in Motijheel was huge. That gap is closing. Under the guidance of the IMF, Bangladesh Bank is letting the Taka find its own level. They call it "crawling," but for someone paying an import bill, it feels more like a sprint.
The crawling peg explained simply
Think of the crawling peg like a dog on a leash. The dog (the exchange rate) can run around a bit, but the owner (the central bank) has a set range of where that dog can go. Every once in a while, the owner moves the whole path. In late 2024, they set the mid-point at 117. By early 2026, that "mid-point" has naturally drifted higher to reflect that the Taka was overvalued for a long time.
Dr. Ahsan H. Mansur, the Governor of Bangladesh Bank, has been pretty vocal about this. The goal isn't to keep the Taka "strong" at all costs. The goal is stability. If the rate stays predictable, businesses can plan. If it’s artificially low, the dollars disappear into the "hundi" or informal markets.
The Remittance Paradox
Expatriates are sending money back at record levels. In December 2025, the country saw a staggering $3.22 billion in remittances. That’s a historic high. So why does the USD to BDT rate keep climbing?
- Import Demand: We still need a lot of dollars to buy oil, fertilizer, and raw materials for the RMG (Ready-Made Garment) sector.
- Debt Servicing: The government has big bills to pay in USD for various infrastructure projects.
- Market Realism: Banks are now allowed to offer more competitive rates to attract those remittances, which pushes the average rate up.
Honestly, the "hundi" system—the informal, illegal way people used to send money—is finally losing its grip. When the official bank rate is 122 and the 2.5% government incentive is added, you’re getting a great deal. There’s less reason to use the shadows. This is why the official reserves have finally stabilized around $33 billion (by traditional counts) or $29 billion (by IMF BPM6 standards).
What this means for your wallet
If you are an exporter, you’re probably smiling. A higher USD to BDT rate means your dollars buy more Taka, helping you pay workers and cover local costs. But if you’re a consumer in Dhaka or Chittagong? It’s tough.
When the dollar gets more expensive, everything else follows.
Bread.
Fuel.
Your Netflix subscription.
Everything.
Inflation is the shadow that follows the exchange rate. The revised budget for 2026 targets 7% inflation, but anyone who has been to the kitchen market lately knows that feels optimistic. The central bank is trying to use interest rates to cool things down, but it's a delicate balance. If they hike rates too much, businesses can't borrow. If they don't hike them enough, the Taka keeps sliding.
💡 You might also like: Does the IRS Process Taxes on Weekends: What Most People Get Wrong
Surprising details from the curb market
What people don't often talk about is the "curb market" or the open market rate. Interestingly, the gap between the bank rate and the open market has shrunk significantly. In 2024, you might see a 5 or 10 Taka difference. Today, it’s often less than 1 or 2 Taka. This is a huge sign of "market normalization." It means the system is finally starting to work the way it’s supposed to, even if the price is higher than we’d like.
Actionable steps for managing currency risk
You can't control the global economy, but you can protect your own interests.
- For Freelancers: Don't let your USD sit in platforms like Payoneer or PayPal for too long if the Taka is on a downward trend, but also watch for those "surge" days. When the rate jumps 1-2% in a weekend, that's your window to withdraw.
- For Small Businesses: If you have import needs, consider forward contracts if your bank allows them. Locking in a rate of 123 now might save you if it hits 126 in three months.
- For Families: Always use the legal channels. Not just because it's the law, but because the 2.5% incentive now makes it mathematically superior to most informal options.
- Monitor the "Mid-point": Keep an eye on Bangladesh Bank's circulars regarding the crawling peg mid-rate. When they move that mid-point, the market usually reacts within 48 hours.
The USD to BDT rate is no longer a stagnant number. It's a living, breathing reflection of Bangladesh's place in the world economy. We are seeing a transition from a protected, somewhat fragile system to one that can actually withstand global shocks. It's a bumpy ride, but for the first time in years, the numbers on the screen actually match the reality in the streets.
Keep an eye on the export data for the next quarter. If RMG exports bounce back from their slight December slump, we might see the Taka find a new floor. Until then, expect the "crawl" to continue.