NRB makes public monetary policy for FY 2023/24

Nepal Rastra Bank (NRB) has made public the monetary policy for the fiscal year 2023/24.

The central bank through the policy has dropped the policy rate, and kept intact the mandatory cash ratio and the statutory liquidity ratio of banks and financial institutions.

Similarly, the bank rate has remained unchanged, and the bidding rate in deposit collection has been decreased.

In view of the internal and external economic scenario, the policy rate has reduced 50 base points to 6.5 percent. The bank rate has been kept intact at 7.5 percent while the bidding rate in deposit collection has dropped to 4.5 percent from 5.5 percent.

The secondary market transaction and the bidding in the deposit collection will remain open if the weighted interbank interest rate considered the operation target by the Rastra Bank is higher than the bank rate and lower than the deposit collection rate.

Similarly, the provision of the permanent liquidity facility in the bank rate and the overnight liquidity facility in the policy rate has been kept unchanged.

There will be a provision of providing the permanent deposit collection at the lower limit of the interest rate corridor for making the interest rate corridor effective, according to the central bank.