Remittances improved slightly in mid-February and mid-March – myRepublica

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KATHMANDU, April 12: Nepal’s Balance of Payments (BoP) stood at negative Rs 258.64 billion in the first eight months of the current fiscal year, with a further increase in net outflow of Rs 11.61 billion rupees in a month in mid-February and mid-February. -March.

The eight-month report on the current macroeconomic and financial situation released by the Nepal Rastra Bank (NRB) on Tuesday shows that the BoP deficit widened from Rs 247.03 billion to Rs 258.64 billion in one month. While the decline in remittances has slowed, import growth is still too high. The existing foreign currency with the country is sufficient to finance the import of goods and services for the next 6.7 months.

Despite the government’s implementation of various measures to control foreign exchange outflows, the country is under increasing pressure from depleted foreign exchange reserves. A drop in the BoP amount means that the country is under increasing pressure to manage foreign currencies in order to transact with other countries.

NRB records show Nepal’s BoP deficit in the first four months of the current fiscal year was Rs 150.38 billion. In the first five months, it reached Rs 195.01 billion, which further increased to reach Rs 241.23 billion in the one-month period of mid-December 2021 and mid-January 2022.

During mid-January and mid-February, Nepal faced a net loss of foreign currency of only Rs 5.80 billion, which had given great respite to the landlocked country which is heavily dependent imported goods.

In mid-March, the current account, one of the main components of the BoP, remained at a deficit of Rs 462.93 billion. During the same period a year ago, the current account deficit was Rs 151.42 billion.

During the period under review, the trade deficit widened by 34.5% to reach Rs 1,160.99 billion, with an increase in import expenditure by 38.6%. NRB records show that the rate of decline in remittances has slowed in recent days.

In mid-March this year, remittances declined by 1.7% to Rs 631.19 billion. Until mid-February of the current fiscal year, remittances decreased by 4.9% compared to 5.5% in the first half of the current fiscal year.

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