“Nepal Rastra Bank’s Mid-September 2023 Financial Snapshot: Inflation, Forex Reserves, and Economic Indicators”

Nepal Rastra Bank, the central bank of Nepal, has released an overview of the current macroeconomic and financial situation in Nepal, based on data from the first two months ending in mid-September 2023.

Inflation and Forex Reserves:The central bank reported an estimated year-on-year inflation rate of 8.19%. Nepal’s gross foreign exchange reserves stood at $12.01 billion, while total imports and exports declined by 5.1%, leading to a 4.7% reduction in the trade deficit.

Concessional Loans: As of mid-September 2023, concessional loans amounted to NPR 195.62 billion, benefiting 144,758 borrowers, with a significant portion directed toward commercial agriculture, livestock, and women entrepreneurs.

Stock Market: The NEPSE index in mid-September 2023 reached 1964.9, compared to 1910.4 in the same period the previous year.

Inflation: Consumer price inflation for the same period was 8.19%, down from 8.64% the previous year. Wholesale price inflation also decreased significantly to 4.78%.

Imports and Exports: Merchandise exports saw a 7.8% decrease in the first two months of 2023/24, while imports decreased by 5.1%. Exports to India declined, but exports to China and other countries increased.

Services and Remittance: Nepal experienced a deficit in net services income, while remittances increased by 22.1%.

Inter-bank Transactions:Interbank transactions, including those among commercial banks and other financial institutions, have seen a substantial increase.

Oil and Gold Prices:The international price of oil increased, while gold prices also rose.

Foreign Exchange Reserves: Gross foreign exchange reserves showed growth, covering a substantial portion of imports and other financial indicators.

Exchange Rate:The Nepalese currency depreciated slightly against the US dollar.

Government Expenditure and Revenue: The government’s expenditure and revenue figures were reported, providing insights into the country’s financial activities.

Banking and Credit: Domestic credit decreased slightly, and the monetary sector’s claims on the private sector increased by 1.7%.

Interest Rates: Various banking sectors reported their average base rates, which showed some variations compared to the previous year.

Balance of Payments: The Balance of Payments (BOP) reflected a surplus, contrasting with a deficit from the same period in the previous year.

This comprehensive report offers a detailed insight into Nepal’s economic and financial landscape during the initial two months of the fiscal year 2023/24.


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