Monetary policy review: Interest for institutional fixed deposit to be less than individual by one percentage point

KATHMANDU: Nepal Rastra Bank has made public the mid-year review of the current fiscal year's monetary policy. 

Based on the review, the central bank has made new arrangements for the implementation of the interest rate of fixed deposits and the interest rate 'corridor'. "To make the interest rate corridor effective, the fixed deposit facility will be implemented from mid-February," the monetary policy review states. "The interest rate of institutional fixed deposits will be arranged so that it can be set one percentage point lower than the interest rate offered for individual fixed deposits."

Similarly, loans up to Rs 20 million granted to agricultural, small, cottage, and medium-scale enterprises will be eligible to be included in the 'Regulatory Retail Portfolio'. Considering the internal and external economic situation and the policy arrangements made during the first quarterly review, the rates under the interest rate corridor have remained unchanged. Provisions related to the compulsory cash reserve ratio and statutory liquidity ratio have been maintained.

In the meantime, the Ministry of Finance has also published the half-yearly review of the current fiscal year's budget . The Ministry has revised and decreased the income and expenditure estimates for the fiscal year.