Foreign currency reserves have shot past the $33 billion mark for the first time in history but it might not bring much cheer for the government as the growth has slowed.

On June 21, the reserves stood at $33.02 billion. A year back it was $29.87 billion, according to Bangladesh Bank data. 

Reserves are expected to rise -- albeit at a more moderate pace than previously estimated -- underpinned by export earnings, foreign direct investment and external borrowing, said International Monetary Fund this month.

IMF says reserves capable of meeting 3.1 (floating exchange rate) to 9.6 (fixed exchange rate) months of imports are adequate for low-income countries.

“Therefore, with the de facto fixed exchange rate, a reserve coverage close to top end of the range would seem appropriate,” it said in its latest report on Bangladesh.

The present amount is enough to foot nine months' import bill at the current growth of foreign purchase, says the IMF.

However, given Bangladesh's slow export growth and decline in remittance inflows, the safe reserve limit should be equal to 9.6 months' import bill, it added.

It was previously assumed that reserves would register an average growth of 8 percent over the medium to long term. Now the expectation is 5 percent.

Possible shocks to the current account include a further, more-than-projected slowdown in remittances and lower external demand for goods.

In the first 11 months of 2016-17, $11.5 billion was received as remittance, down 14.18 percent year-on-year on the back of low oil prices and deepening conflict in Gulf countries -- the largest source of overseas income.

Remittance inflows continue to decline even though the number of Bangladeshi workers abroad has increased steadily in recent years.

“Prospects for remittances are subject to considerable uncertainty, as the recent decline has been particularly pronounced,” the IMF said.

Meanwhile exports stood at $31.79 billion, up by 3.67 percent from the same period a year ago.

About export prospects, the IMF said global growth is more subdued now than in the past. The US, Germany and the UK represent Bangladesh's three main export destinations. Thus, a slowdown in the European Union may hurt exports.

General uncertainties over rising protectionist measures will continue to shadow the outlook for Bangladeshi exports, the IMF added.

In the first ten months of the fiscal year, the average monthly import bill was $3.62 billion.

“Benchmarking adequate level of reserves is central to designing policies that preserve the country's resilience to external shocks, particularly given Bangladesh's limited access to capital markets,” the IMF said. The current account deficit reached $1.8x billion in the first ten months for sliding remittance inflows and sluggish exports. It was $3.53 billion in the surplus a year earlier, according to the central bank's balance of payments data.

The last time the current account was in the deficit, by $447 million, was way back in 2011-12.

Remittance has been a major source of foreign currency for Bangladesh in the last 10 to 12 years.

However, Bangladesh Bank predicts that at the end of the fiscal year the current account deficit will come down to within $600 million as remittance inflows and exports rise.