The recent devaluation spree in many countries after large devaluations of Chinese Yuan and Euro has resurrected a lively debate on exchange rate management options in Bangladesh. Though Bangladesh officially maintains a freely floating exchange rate system since 2003, the exchange rate system in Bangladesh is dubbed dirty float and it remains almost fixed for the last few years albeit at a devalued level. The US dollar, the main vehicle currency of Bangladesh's trade, was managed heavily in the last few years so that a stable nominal exchange rate can be ensured.