Dhaka, Jan. 29 -- Bangladesh's exports are set to lose competitiveness to foreign buyers while imports getting cheaper as the local currency 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) of the taka against the globally losing US dollar climbed to 106.37 in November, remaining almost same with October figure. This REER rise signals that the local currency remains stronger than its equilibrium level.

Economists alert that the overvaluation could erode export competitive...