Current Macroeconomic and Financial Situation of Nepal
Financial Notices  

Current Macroeconomic and Financial Situation of Nepal

(Based on One Month’s Data Ending Mid-August, 2020/21)

The country’s balance of payments is in surplus of Rs. 51.46 billion. According to Nepal Rastra Bank (NRB), the balance of payments situation is as follows in the first month of the current fiscal year. Similarly, inflation on the basis of the consumer price index stood at 3.49%. During the review month, remittance inflows increased by 23%. According to the NRB, remittances of Rs 92.71 billion were received during the period.

Remittance income had increased by only 2% in the corresponding period of the previous year. Similarly, remittance inflows against the US dollar increased by 14.5%. Total foreign exchange reserves stood at US 12.2 billion. Similarly, the current account of the government is also in surplus of Rs. 25.41 billion. 

The average interest rate on bank loans has come down. The average interest rate on loans fell to 10.47 percent from 12 percent in July this year, according to the central bank. The interest rate on loans has come down along with the decline in the base rate of banks. The average base rate of banks has declined by 1.37% to 8.08 percent in a year. 

The weighted average interest rate on deposits of commercial banks has also declined. The average interest rate on deposits stood at 5.77% in July. Such interest rate was 6.77% in the corresponding period of the previous year. 

Based on the imports up to the first month of FY 2077/78, the foreign exchange reserves of the banking sector will be sufficient to support 17.3 months of imports of goods and 15.6 months of imports of goods and services, the central bank said.

Major Highlights

  • Inflation remained 3.49 percent on y-o-y basis.
  • Imports decreased 19.6 percent and exports increased 8.9 percent.
  • Remittances increased 23.0 percent.
  • Balance of Payments remained at a surplus of Rs.51.46 billion.
  • Gross foreign exchange reserves stood at USD 12.02 billion.
  • Federal Government spending amounted to Rs.1.95 billion and revenue collection Rs.58.81 billion.
  • Broad money (M2) expanded 0.3 percent. On y-o-y basis, M2 expanded 18.9 percent.
  • Deposits at BFIs and claims on private sector broadly remain same at the level of mid-July 2020.
  • However, on y-o-y basis, deposits increased 19.0 percent and claims on private sector 11.3 percent.

Current Macroeconomic and Financial Situation of Nepal (with full text – in English)

Current-Macroeconomic-and-Financial-Situation-English-Based-on-One-Month-data-of-2020_21-financial-notices

देशको वर्तमान आर्थिक तथा वित्तीय स्थीति (पूर्ण पाठ सहित– नेपालीमा)

Current-Macroeconomic-and-Financial-Situation-Nepali-Based-on-One-Month-data-of-2077_78_financial_notices

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