Bangladesh Taka (BDT): Currency, Denominations, Inflation, and Purchasing Power
This article covers the Taka as a currency , what it is, its denominations, its inflation record, and what those numbers mean for everyday purchasing power in Bangladesh. It is for students, researchers, and anyone who wants a factual reference on BDT beyond a single exchange rate quote.
৳100 in 1980 had the same purchasing power as approximately ৳2,774 today. That is a 2,674% cumulative price increase over 45 years , driven by one of South Asia's highest sustained inflation rates. While the number on the note has not changed, what it buys has.
What Is the Bangladesh Taka?
The Bangladesh Taka (sign: ৳, ISO code: BDT, informal abbreviation: Tk) is the official currency of Bangladesh, issued and regulated by Bangladesh Bank.
The Taka was introduced on 4 March 1972, one year after Bangladesh's independence from Pakistan. It replaced the Pakistani Rupee, which had continued circulating in the newly independent country for approximately three months after independence. The Taka is divided into 100 poysha , but poysha coins are no longer in everyday circulation. Poysha exists today only as an accounting unit: bank balances show values like Tk 1,234.56, but no merchant accepts or dispenses poysha physically.
The issuing authority is split by denomination. Bangladesh Bank issues all banknotes of ৳10 and above. The Ministry of Finance issues the smaller ৳2 and ৳5 notes.
As of March 2026, Bangladesh Bank does not print the 1-taka or 2-taka notes; those denominations are issued by the Ministry of Finance.
The most commonly used symbols are ৳ (the official sign) and Tk (used on printed receipts and everyday signage). Both refer to the same currency.
Taka Denominations
The Bangladesh Taka currently circulates in nine banknote denominations , ৳2, ৳5, ৳10, ৳20, ৳50, ৳100, ৳200, ৳500, and ৳1,000 , and three coin denominations: ৳1, ৳2, and ৳5.
Banknotes:
Coins: ৳1, ৳2, and ৳5 coins are in occasional circulation. The ৳1, ৳2, and ৳5 notes have largely been replaced by their coin equivalents. All poysha coins , 1, 5, 10, 25, and 50 poysha , are out of circulation. Inflation has rendered them effectively worthless for everyday transactions.
Bangladesh Bank announced in 2024 that all Taka banknotes would be redesigned following the July Revolution. The previous series featured the portrait of Sheikh Mujibur Rahman. The redesign removes political portraiture and replaces it with national heritage imagery. New designs were expected to roll out from 2025 and may already be in partial circulation by the time of reading.
Taka Inflation History
Based on the latest economic data from the Bangladesh Bureau of Statistics (BBS), Bangladesh Bank, Bangladesh has one of the highest long-run inflation records in South Asia , averaging 7.7% annually from 1980 to 2025, which means prices have multiplied approximately 28 times over that period.
Long-run (1980–2025): Over 45 years, Bangladesh averaged 7.7% annual inflation. An item costing ৳100 in 1980 costs approximately ৳2,774 in 2026 , a 2,674% cumulative increase. This rate of erosion is significantly higher than developed economies but comparable to other South and Southeast Asian countries during their development phases.
Recent five years (2020–2025): Bangladesh's inflation accelerated sharply in the post-pandemic period. Over the five years to end-2025, inflation averaged 8.1% annually , a cumulative price rise of 47.4%. The US experienced 4.5% average annual inflation over the same period , 24.5% cumulative. Bangladesh's price rises were nearly double the US rate.
2025–2026: According to Bangladesh Sangbad Sangstha (BSS) reporting on BBS data, annual inflation in Bangladesh reached 9.13% in February 2026, up from 8.58% in January and 8.49% in December 2025.. Food and non-alcoholic beverages inflation reached 9.30%. Bangladesh Bank's own revised inflation target for FY26 is "below 8.0%" , still above target as of February 2026. The IMF projects 8.7% by end of FY26, versus Bangladesh Bank's own forecast of 7.92%.
Key drivers of recent inflation of BDT include the aftermath of the July–August 2024 political disruption, elevated food import costs, currency depreciation pass-through, and energy price pressures.
Taka Purchasing Power
The purchasing power of the Taka has eroded significantly over time , ৳1,000 today buys what approximately ৳36 bought in 1980, and what approximately ৳680 bought in 2010.
Historical erosion: In 1980, ৳26.79 had the purchasing power of ৳1,000 in 2026 terms. The same physical ৳1,000 note printed in 1980 is still worth ৳1,000 in face value , but its real purchasing power has collapsed by over 96%. This gap between face value and real purchasing power is the direct result of 45 years of compounding inflation.
What ৳1,000 buys in 2026: Purchasing power varies between urban and rural areas, and between food and non-food categories. As a rough reference for Dhaka consumers: ৳1,000 covers approximately 5–7 kg of rice, or 2–3 days of basic household groceries, or a short-distance taxi trip plus a meal.
The savings implication: Standard bank savings accounts in Bangladesh offer a weighted average nominal deposit rate of 6.34% as of December 2025 (source: MPS H2FY26). Against 9.13% inflation in February 2026, the real deposit rate is approximately −2.8%. The Taka balance grows in nominal terms but buys less each year. This structural problem drives demand for USD-denominated accounts and foreign currency savings instruments among urban earners.
For example, if you kept ৳100,000 in a savings account earning 5% annually for five years, your nominal balance would reach ৳127,628 , but at 8% annual inflation, the real purchasing power of that amount would be lower than your original ৳100,000.
Taka Value Against the US Dollar
The Taka has depreciated significantly against the US dollar , from around 85 BDT per USD in 2021 to approximately 122.31 BDT per USD at end December 2025, representing a 43% loss in value over four years. (Source: Bangladesh Bank, MPS H2FY26.)
The Bangladesh taka depreciation trajectory as of March 2026:
- According to Bangladesh Bank's Monetary Policy Statement (MPS H2FY26),The interbank spot rate at end December 2025 was 122.31 BDT/USD , a 0.38% appreciation versus end June 2025 (122.77), suggesting temporary stabilisation within the crawling peg band
- Bangladesh Bank cleared USD 3.5 billion in outstanding correspondent banking arrears in 2025, reopening formal remittance channels and supporting reserve recovery
- According to TradingEconomics data, Gross international reserves reached USD 28.52 billion (BPM6 basis) at end December 2025, rising to approximately USD 35.1 billion (gross) by February 2026 (source: TradingEconomics, March 2026)
- The REER appreciated 6.63% in H1FY26, moving to 102.74 from 96.35 , suggesting the BDT is slightly overvalued in real terms relative to its trading partners
Bangladesh imports a significant share of its food, fuel, and raw materials. When the Taka weakens against the USD, import costs rise in Taka terms , feeding directly into domestic consumer price inflation. The USD/BDT rate and domestic CPI are therefore structurally linked in Bangladesh.
Why Inflation Has Stayed High in Bangladesh
Bangladesh's inflation has remained elevated because of a combination of structural factors: high import dependence, currency depreciation, disrupted supply chains, and the economic fallout from the July–August 2024 political crisis.
Import dependence
Bangladesh imports a large share of its food , including wheat, edible oil, and sugar , as well as fuel and industrial inputs. When global commodity prices rise or the Taka weakens, import costs rise in BDT regardless of local supply conditions. This structural exposure means external shocks transmit quickly into domestic prices.
Currency depreciation
A weaker Taka directly increases the BDT cost of every imported item. The Taka's depreciation from 85 to 122 BDT per USD since 2021 has been a sustained transmission channel for imported inflation throughout this period.
Political disruption (2024)
The July–August 2024 mass uprising and subsequent political transition caused factory closures, supply chain disruptions, and a sharp spike in inflation. Nearly 245 factories shut down between August 2024 and July 2025, affecting around 100,000 workers and disrupting domestic production. Official MPS H2FY26 data states deposit growth fell to "below 7.0%" (specifically ~6.8-7.0%) in August 2024 due to the panic withdrawals during the revolution.
Structural food system pressures
Bangladesh's food prices , particularly for rice, vegetables, and cooking oil , are sensitive to seasonal supply shocks, hoarding, and market concentration. Food inflation regularly runs above overall CPI, directly hitting lower-income households hardest.
Taka Exchange Rate Policy
Bangladesh Bank manages the Taka through a crawling peg system and, from May 2025, full FX flexibility , allowing the exchange rate to adjust based on market forces within a framework rather than holding a strict fixed rate.
The Taka Exchange Rate policy evolution:
- Before May 2024: Bangladesh Bank maintained a managed float, actively intervening to hold the Taka within a narrow range against the USD, consuming foreign exchange reserves
- May 2024: Crawling peg introduced, starting at 117 BDT/USD, allowing a pre-set rate of gradual adjustment
- 14 May 2025: Full FX flexibility implemented (FE Circular No. 18) , the most significant exchange rate liberalisation in Bangladesh's recent history
- Current rate: 122.31 BDT/USD at end December 2025, within the post-crawling-peg range
The official interbank spot rate is published daily by Bangladesh Bank at bb.org.bd. Banks and remittance services apply a spread on top of this rate when buying or selling foreign currency. Bangladesh Bank's ability to maintain rate stability depends on its gross reserves , which recovered from a low of USD 25.6 billion (gross) in August 2024 to USD 35.1 billion (gross) by February 2026, aided by the USD 3.5 billion in cleared correspondent banking arrears and record remittance inflows.
The Taka and Everyday Financial Life in Bangladesh
Most everyday transactions in Bangladesh are conducted in cash using ৳10, ৳50, ৳100, and ৳500 notes , but digital payments via bKash and Nagad have grown rapidly, particularly for transfers and merchant payments in urban areas.
Cash vs digital
Physical cash remains dominant for small retail transactions, rural markets, and agricultural payments. The ৳100 and ৳500 notes are the most commonly circulated denominations for everyday urban spending. The ৳1,000 note, introduced in 2008, is used primarily for larger transactions and savings.
Digital payments
bKash and Nagad , the two dominant mobile financial services , have significantly reduced the need for physical cash transfers. Digital payment infrastructure received a structural upgrade in November 2025 when NPSB interoperability went live, allowing direct transfers between bKash, Nagad, Rocket, and bank accounts. According to Prothom Alo, Google Pay launched in Bangladesh in June 2025 through City Bank, expanding NFC contactless payment options for Android users.
Savings and the inflation problem
Standard bank savings accounts offer a weighted average nominal deposit rate of 6.34% as of December 2025 , well below the 9.13% inflation rate recorded in February 2026 (source: MPS H2FY26). Real deposit rates are negative at approximately −2.8%. Fixed deposit rates are higher: FDR under 1 year averages 9.42%, and FDR 1–3 years averages 10.06% as of December 2025 , just crossing into positive real territory. This gap between savings returns and inflation is one reason some urban earners explore USD-denominated accounts and foreign currency instruments.
Frequently Asked Questions
What is the symbol for the Bangladesh Taka?
The official symbol is ৳ (a Bengali letter with a line through it). In everyday use , on receipts, menus, and signage , "Tk" is also widely used.
Is poysha still used?
Poysha coins are no longer in active circulation , inflation has rendered them effectively worthless for everyday transactions. The subunit still appears in bank account balances and accounting records, but no merchant accepts or dispenses poysha.
What are the largest and smallest Taka notes in circulation?
The largest is the ৳1,000 note, introduced in 2008. The smallest in regular use is ৳10. The ৳2 and ৳5 notes are issued by the Ministry of Finance and are still technically in circulation but are primarily encountered in rural areas.
Why has the Taka been losing value?
The Taka has depreciated against the USD due to a combination of elevated domestic inflation, foreign exchange reserve depletion during 2022–2024, high import costs, and the economic disruption following the 2024 political crisis. Reserves have since recovered significantly.
What is the highest denomination Taka note?
The ৳1,000 note is the highest denomination currently issued by Bangladesh Bank.
Key Takeaways
The Bangladesh Taka (৳, BDT) is the official currency of Bangladesh, introduced in March 1972. Bangladesh Bank issues all denominations of ৳10 and above. The Ministry of Finance issues ৳2 and ৳5. Poysha (1 Taka = 100 poysha) exists as an accounting unit only. Current notes range from ৳2 to ৳1,000; ৳200 was added in 2020. Bangladesh Bank redesigned the note series from 2024–2025 following the political transition.
Inflation has been the dominant force shaping the Taka's purchasing power. Average annual inflation of 7.7% since 1980 has eroded purchasing power by over 96% in real terms. Annual inflation stands at 9.13% in February 2026 (source: BBS/BSS News, March 2026). The weighted average nominal deposit rate of 6.34% as of December 2025 leaves real deposit returns at approximately −2.8%.
The Taka has depreciated from 85 to approximately 122.31 BDT per USD since 2021. Bangladesh Bank moved to a crawling peg in May 2024 and introduced full FX flexibility in May 2025. Gross reserves recovered to approximately USD 35.1 billion by February 2026 after reaching a low of USD 25.6 billion in August 2024.
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