Dhaka, Jan. 7 -- The yields on two-year treasury bonds fell on Tuesday as the central bank purchased US$223.50 million more from 14 banks in a bid to stabilise the exchange rate of the US dollar against the local currency.

The cut-off yield, generally known as interest rate, on the Bangladesh Government Treasury Bonds (BGTBs) came down to 10.51 per cent on the day from 10.72 per cent earlier, according to auction results.

"Most banks are parking excess liquidity in the risk-free securities as private sector credit demand remains weak ahead of the upcoming national polls," a senior Bangladesh Bank (BB) official told The Financial Express (FE), citing political uncertainty and cautious lending sentiment.

He also said higher remittance in...