Remittance Inflows Surge

In a recent update from the Nepal Rastra Bank, it has been revealed that remittance inflows into the country witnessed a substantial increase of 25.8 percent in the first month of the current fiscal year, reaching Rs 116.02 billion. This growth surpasses the 20.3 percent increase observed during the same period in the previous fiscal year.

Simultaneously, the central bank reported that the number of Nepali workers seeking approval for foreign employment amounted to 39,152 individuals in the first month. This marks a 12.1 percent decrease compared to the corresponding period in the previous year.

Furthermore, the current account has remained in surplus, with a balance of Rs 12.99 billion in the review period, contrasting with a deficit of Rs 15.13 billion in the same timeframe the previous year.

During this period, capital transfers saw a notable decrease of 65.9 percent, totaling Rs 272.6 million, while net foreign direct investment (FDI) remained positive at Rs 2.65 billion.

Additionally, the balance of payments (BOP) reported a surplus of Rs 32.90 billion in the review period, a significant improvement from the Rs 19.76 billion deficit experienced during the same period in the last fiscal year.

The Nepal Rastra Bank also reported a year-on-year consumer price inflation of 7.52 percent in mid-August, down from 8.26 percent the previous year. Food and beverage inflation stood at 8.95 percent, while non-food and service inflation was recorded at 6.42 percent.

On the trade front, the country’s exports declined by 8.7 percent to Rs 13.53 billion during the first month of the fiscal year, although this represents a substantial improvement from the 28.7 percent decrease observed in the same period of the previous year. Exports to India saw a decline of 20.8 percent, while exports to China and other countries increased by 527.2 percent and 15.4 percent, respectively.

Importantly, during the first month of the fiscal year, the country’s imports decreased by 1.6 percent to Rs 129.24 billion, a smaller decrease compared to the 12.9 percent drop recorded in the previous year. Imports from India and China increased by 3.3 percent and 17 percent, respectively, while imports from other countries decreased by 23.1 percent.