Country’s economy is in moderate condition, governor says

Kathmandu: Governor of Nepal Rastra Bank (NRB) Maha Prasad Adhikari says the country’s current economic condition was moderate.

Addressing a programme organized on the 69th anniversary of NRB on Friday, the governor said the year 2080 BS witnessed positive signs in the external sector of the economy despite low demand for credit and economic slowdown.

He also said that the central bank succeeded in managing fiscal stability strengthening the payment system and containing high inflation.

The NRB governor argued that the inflation rate of consumer goods in the current fiscal year is expected to be within the moderate cap of 6.5 per cent. He, however, cautioned that the Russia-Ukraine conflict and ongoing conflicts in the Middle East, and the ban imposed by some countries on the export of foodstuffs could pose risks with price fluctuation in foodstuffs and fuel.

“Like the previous fiscal year, growth in remittance inflow is encouraging,” he added, stating that sufficient liquidity in the market and reduced interest rates have created bases for better economic activities.

Likewise, the governor said that agricultural output is estimated to be satisfactory in the current fiscal year due to favourable weather and timely supplies of fertilizers.

Production of 600 megawatts of power in the current fiscal year and progress in the tourism industry could ensure an average growth in the economy, he added.

Similarly, he shared that the central bank is making efforts to formulate some vital laws and procedures for the management of monetary and fiscal sectors. And added that drafting of the Lease Finance, and Securitization among others is ongoing.

Adhikari claimed that the NRB was doing effectively for the management of the monetary sector adding that the central bank has a vital role in the country’s overall economic development and fiscal stability.