Dhaka, Nov. 26 -- Bangladesh's exports may get costlier to foreign buyers while imports cheaper as the local currency, taka, appears increasingly overvalued in the foreign-exchange basket in real terms.

Economists explain that this economic paradox appears for sluggish import demand, weak private-sector credit growth, and stubbornly higher inflation on the economy.

Bangladesh Bank's latest data show the real effective exchange rate (REER) climbed to 106.55 in October against 104.53 in September last or a month earlier. This REER rise signals that the local currency remains stronger than its equilibrium level.

Economists alert that the overvaluation could erode export competitiveness and disrupt the country's external balance if left un...