Bangladesh’s foreign exchange reserves have fallen below $20 billion, specifically dropping to $19.44 billion as of Thursday.

Sources from the Bangladesh Bank said that this decline occurred after a recent payment of $1.37 billion for an import bill through the Asian Clearing Union (ACU).

The Central Bank’s report published on Thursday confirmed that, under the International Monetary Fund’s BPM 6 accounting method, reserves have indeed dipped below $20 billion.

The Asian Clearing Union (ACU) is an inter-regional settlement system used by central banks to facilitate the settlement of imports and exports among its nine member countries: Bangladesh, India, Iran, Nepal, Pakistan, Myanmar, Bhutan, and the Maldives. Sri Lanka was recently removed from the list due to debt default.

According to the BPM 6 accounting standard accepted by the IMF, the total reserves decreased to $24.5 billion, down from $25.6 billion at the end of the previous week.

Despite the current reduction, there is optimism that reserves will recover. The growth in remittances from expatriates is expected to bolster the reserves and potentially push them back above the $20 billion mark.

Among ACU member countries, India typically receives more dollars than it remits, while most other countries spend more dollars than they earn.

The import charges deposited by these countries with their central banks contribute to the reserves. These reserves are later used to pay off ACU-related bills.