Bangladesh currency
A Bangladeshi currency vendor displays fresh notes for clients in Dhaka in this August 4, 2003 file photo. REUTERS/RAFIQUR RAHMAN

After assigning an inaugural rating of "BB-" for Bangladesh's long-term local as well as foreign currency sovereign issuance, rating agency Fitch has called for a teleconference of market participants, giving them an opportunity to know more about the major rating move.

Following the Fitch announcement, Bangladesh's currency strengthened against the dollar. The USD/BDT pair fell near 77.0, a multi-month low, after holding near 77.6 for quite a long time.

The teleconference will be held at 4pm HK/Singapore (2pm Dhaka) on Wednesday, 3 September.

The call will be hosted by Thomas Rookmaaker, Director in Fitch's Asia-Pacific Sovereigns Group in Hong Kong, Fitch said.

Attendance for the teleconference is free but participants are requested to register via the link below to reserve a spot on the call, the rating agency said.

http://fitchratings.nyws.com/Register.asp?ID=3249

Growth and Inflation

The rating agency had cited the GDP growth performance of the South Asian nation as one of the major factors for the rating initiative. Bangladesh's 6.2% expansion over the past five years compares with a median of 4.0% growth of the other "BB-" rated countries.

Fitch also noted that inflation that averaged 8.1% over the past five years is higher than the peer category median of 4.6% and above the central bank's FY-15 target of 6.5%.

Outlook

The stable outlook reflects Fitch's assessment that upside and downside risks to the rating are well balanced.

Factors that could trigger positive rating action are governance reforms, substantial reduction of political risk and the strengthening of the balance sheets and governance in the banking sector.

The political unrest seen ahead of the January general elections did not impact the economy as feared but if the uncertainty surrounding politics continues, then it will negatively impact the country's overall performance, the rating agency said.

Also, Bangladesh scores poorly on a broad range of governance indicators and ranks low on the United Nations' human development indicators, affecting the country's credit rating.