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The Nepal Stock Exchange (NEPSE) gained 12. 73 points to close at 2,088.70 points on Tuesday. Similarly, the sensitive index surged by 2.28 points to close at 388. 62 points. A total of 6,450,934-unit shares of 282 companies were traded for Rs 2. 57 billion. Meanwhile, City Hotel Limited was the top gainer today, with its price surging by 9. 98 percent. Similarly, BPW Laghubitta Bittiya Sanstha Limited was the top loser as its price fell by 9.99 percent. At the end of the day, total market capitalization stood at Rs 3. 05 trillion.

After going through a liquidity crunch in the first half of the current fiscal year, the banking system is once again flushed with excess liquidity. With demands for loans drying up, investable capital has been piling up in the banking system in recent days. As of June 29, investable capital worth Rs 357.21 billion has been accumulated in banks and financial institutions (BFIs). The deposits of BFIs amounted to Rs 5,599bn, while loans totaled Rs 4,859bn. As there is no demand for loans currently, the CD ratio of commercial banks has been continuously decreasing. The CD ratio which was 88.07 percent in mid-July, 2022, has fallen to 83.62 percent on June 29, 2023. As per central bank regulatory norms, banks can disburse 90 percent of their deposits in loans. Banks have to maintain the credit-to-deposit ratio (CD ratio) at 90 percent. Bankers say commercial banks are now in a situation to give loans of around Rs 350bn. As the government also spends in the last quarter massively, a large amount of cash is deposited in banks in the period. BFIs generally make little lending during the last quarter of the fiscal year. The BFIs that were experiencing a liquidity crunch until a few months ago are now facing problems of non-disbursement of loans. While liquidity is increasing, bankers say demands for loans have remained low. The credit expansion to the private sector in the first 11 months of the current fiscal year is far less than what the BFIs lent during the same period last fiscal year. According to the data of the Nepal Rastra Bank, the deposits of commercial banks have increased by Rs 386bn in the current fiscal year. However, their lending has grown by Rs 130bn only. According to bankers, the private sector has not sought bank loans with the deepening economic downturn. On the other hand, retail loans such as housing loans and auto loans have not grown with interest rates still remaining high. While the BFIs have been gradually lowering the loan interest rates, the demand for loans has not surged as expected. “The demands for loans have remained subdued due to the state of the economy and businesses,” said Sudesh Khaling, CEO of Everest Bank, “The demand for loans will not increase automatically even if the interest rate is falling. there must be a conducive business environment for that.” Bankers say lending will not grow much in Ashad, the last month of the fiscal year, in which BFIs will be more focused on loan recovery. Bankers say the other reason behind the sluggish lending is banks have become more cautious in loan disbursement due to a sharp rise in non-performing loans (NPLs).

The price of gold has increased by Rs 400 per tola in the domestic market on Tuesday. According to the Federation of Nepal Gold and Silver Dealers’ Association, the precious yellow metal is being traded at Rs 110, 400 per tola today. It was traded at Rs 110, 000 per tola on Monday. Meanwhile, tejabi gold is being traded at Rs 109, 850 per tola. It was traded at Rs 109, 550 per tola. Similarly, the silver is being traded at Rs 1,375 per tola today.

In what augurs well for the Nepali tourism industry, the number of tourist arrivals has reached 476,507 in the first half of 2023. The tourist arrival has surged by 97.79 percent in the first six months of 2023 compared to the same period in 2022. With healthy growth in tourist arrivals from the start of this year, tourism entrepreneurs are expecting 1m international visitors in the country by the end of 2023. While tourist arrivals have improved significantly compared to the last three years, the number is yet to touch the pre-Covid level. Nepal had received 573,658 tourists in the first six months of 2019. The arrival of foreigners in the first six months of 2023 is 83.06  percent compared to the same period in 2019. According to the latest statistics from the Nepal Tourism Board (NTB), Nepal welcomed 72,250 foreign visitors in June. The tourist footfall in June 2023 is 96.48 percent compared to June 2019 when 74,883 foreigners visited Nepal. Nepal welcomed 55,074 international visitors in Jan, 73,255 in Feb, 99,426 in March, 98,773 in April, and 77,703 in May. Nepal received the highest number of tourists from India, the US, and China in June. According to NTB, 38,845 Indian tourists and 8,470 US visitors came to Nepal in June. The country welcomed 4,343 tourists from China, 2,402 tourists from Bangladesh, 1,992 from the United Kingdom, 1,639 from Australia, 1,079 from Malaysia, and 8,88 from South Korea. With the easing of travel restrictions and China reponing outbound travel for its citizens, Nepali tourism entrepreneurs are pinning high hopes for 2023. NTB on its 24th anniversary announced that it aims to attract at least one million foreign tourists in 2023. In 2022, tourist arrivals reached over 600,000 without any significant contribution from China. Only 9,595 Chinese tourists visited Nepal in 2022. Tour operators say they are receiving increasing fresh inquiries from major source markets including China. While the FITs (free independent travelers) have already started coming to Nepal, group travelers from the northern neighbor arrived in the second week of April, the first group tour from China after the Covid-19 pandemic. The arrival of 180 Chinese trekkers in Nepal on April 13 has rekindled hopes for Nepal’s tourism sector. They were the first of four batches of nearly 8,00 Chinese trekkers to visit Nepal to trek on the Poon Hill trail located some 270 kilometers west of Kathmandu. This visit has come after China included Nepal on a second list of 40 destinations for group tours that Chinese nationals could visit starting from March 15. After the northern neighbor allowed its citizens to visit Nepal, NTB and Nepali travel trade entrepreneurs are visiting various Chinese cities to promote Nepal tourism. Travel trade entrepreneurs say that a significant contribution of Chinese tourists would be required if Nepal wants to meet the target of one million visitors in 2023.