Nepal’s troubled foreign exchange reserves improve

foreign exchange reserve
Representational image

Kathmandu, July 12

There has been a slight improvement in Nepal’s foreign exchange reserves over the past month.

The foreign exchange reserves stood at Rs 1.176 trillion on June 14 compared to Rs 1.146 trillion on May 14, which is around Rs 29 billion increase in a month, according to Nepal Rastra Bank.

Nepal’s foreign exchange reserves had gone down by over 15 per cent between June 2021 and April 2022.

According to Nepal Rastra Bank, it has 1.031 trillion foreign exchange reserves while other commercial banks have the remaining Rs 114.95 billion.

The central bank states that the country can buy goods and services for less than seven months with the existing foreign money.

This is seen as good news and Nepal’s balance of payment is the lowest it has ever been. The central bank of Nepal tightened rules and requirements for foreign currency exchange as the country’s exchange reserves were on the decline.

Nepal Rastra Bank also brought a new policy that increased the cost of various products ranging from alcohol and cosmetics to vehicles. The government is also preparing to extend the ban on the import of 10 specific luxury items imposed in April.

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