Menu
Thu, March 28, 2024

NRB makes public Monetary Policy 2022/23 3rd quarter review

A A- A+
KATHMANDU: Nepal Rastra Bank (NRB) has made public the Monetary Policy 2022/23 3rd quarter review. The central bank has made public the monetary policy review keeping in view the economic and financial situation up to nine months of the current fiscal year, implementation status of the policies and programmes mentioned in the monetary policy, mid-year evaluation of the budget of the government for the current fiscal year and national and international economic scenario. According to the review, economic activities began to expand as the risk of Covid 19 infection subsided. With the local level elections held on April 13, the economy has become more dynamic, the report said. The Central Bureau of Statistics (CBS) has released a preliminary estimate of 5.84% growth in GDP for the current fiscal year. As per the review by the central bank, the average consumer price inflation has been within the target range in the nine months of current fiscal year 2021/22. However, the sharp rise in petroleum prices, the impact of Russia-Ukraine war, expansion of domestic demand, and economic activities during elections have put pressure on prices. The report says the external sector came under pressure due to significant increase in imports and steady remittance inflows during the review period. The current account and balance of payments (BoP) deficit in the external sector has increased while the capacity of foreign exchange reserves to support imports has decreased. The share of total consumption in the GDP is estimated to be 90.73% in the current fiscal year. Such consumption is expected to increase by 11.5% in the current fiscal year as compared to 7.7% in the previous year. Lately, inflation has been on the rise. On a year-on-year basis, inflation rose from 3.10% in March/April 2021 to 7.28% in March/April 2022. During the period, inflation in food and beverages rose from 3.49% to 7.40%, while in non-food and services rose from 2.79% to 7.18%. According to the Government of Nepal, Ministry of Finance (Financial Comptroller General Office), the total expenditure of the Federal Government till April 13, 2022, in the current fiscal year is Rs 794.26 billion. During this period, recurrent expenditure was Rs 625.50 billion, capital expenditure was Rs 103.79 billion and expenditure under financial management was Rs 64.97 billion. The total revenue of the federal government during the review period was Rs 789.26 billion (including the amount to be distributed at the provincial government and local levels). Out of this, tax revenue of Rs 727.79 billion and non-tax revenue of Rs 61.47 billion have been mobilised. During the review period, the federal government has mobilised a total of Rs 105.47 billion including Rs 50 billion through treasury bills, Rs. 54.50 billion through development bonds and Rs 970 million through citizen savings. Due to the significant deficit in the BOP during the review period, the monetary expansion has slowed down as the base currency has been harnessed from the market. On a year-on-year basis, the broad money supply increased by 10.4% by April 13, 2022, while narrow money supply increased by 3.6%. On an annual point basis, broad money supply increased by 23.9% and narrow money supply increased by 23.7$ in the same period of the previous fiscal year. In the monetary policy of the current fiscal year, the target of maintaining the annual growth rate of broad money supply has been fixed at 18%. However, on an annual point basis, broad money supply has increased by 10.4%. READ ALSO:
Published Date:
Post Comment
E-Magazine
FEBRUARY 2024

Click Here To Read Full Issue