Broad Money registers growth of 9.5 percent

Broad money registered a growth of 9.5 percent in the first five months of fiscal year 2007-08, said a report of Nepal Rastra Bank (NRB).

In first four months of previous fiscal year, broad money had registered a growth of 4.0 percent. An increase in domestic credit on account of an increase in credit to the government and the private sector contributed to this growth in the review period.

The report shows time deposits increased to Rs. 300.18 billion that is a growth by 11.7 percent in the review period. It grew by 4.6 percent in previous year. Besides the elevated level of remittances, commencement of banking transactions by three new commercial banks and branch expansion by the existing commercial banks contributed to the rise in time deposits in the review period.

Similarly, Net Foreign Assets (NFA), after adjusting foreign exchange valuation gain/loss, increased by Rs 24.1 million in the review period compared to a rise of Rs 5.78 billion (4.1 percent) in the previous year.

Despite the elevated level of remittances and a boom in tourism, NFA remained almost stagnant on account of a deceleration in foreign assistance, a higher level of payment to Indian Oil Corporation (IOC) by Nepal Oil Corporation (NOC) and dissatisfactory performance of export in the review period, said the report.