Fiscal Year 2077/78 Ends Today, This is How We Performed As a Nation This Year

The central bank has published macro-economic data based on the first eleven month's data of FY 2077/78. The report covers major details on inflation, trade, services, remittance, BOP position, foreign exchange reserves, fiscal deficit, surplus, expenditure, revenue, money supply, deposit, credit liquidity, interest rates, and the capital market.

Some of the major highlights from the reports are:

Inflation: The y-o-y consumer price inflation stood at 4.19 percent in the eleventh month of 2020/21 compared to 4.54 percent a year ago. Food and beverage inflation stood at 6.22 percent whereas non-food and service inflation stood at 2.63 percent in the review month. 

Import and export: During the eleven months of 2020/21, merchandise exports increased 37.8 percent to Rs.121.25 billion compared to an increase of 0.2 percent in the same period of the previous year. Destination-wise, exports to India and other countries increased 43.3 percent and 25.9 percent respectively whereas exports to China decreased 17.4 percent. Exports of soya bean oil, cardamom, polyster yarn and threads, jute goods, woollen carpet, among others, increased whereas exports of palm oil, pulses, zinc sheet, wire, cattle feed, among others, decreased in the review period.

During the eleven months of 2020/21, merchandise imports increased 22.3 percent to Rs.1254.11 billion against a decrease of 13.0 percent a year ago. Destination-wise, imports from India, China, and other countries increased 29.8 percent, 17.2 percent, and 6.2 percent respectively. Imports of transport equipment & parts, crude soyabean oil, M.S. billet, rice, telecommunication equipment, and parts, among others, increased whereas imports of aircraft spare parts, crude palm oil, petroleum products, video television and parts, silver, among others, decreased in the review period.

Services: Net services income remained at a deficit of Rs.58.10 billion in the review period compared to a deficit of Rs.1.23 billion in the same period of the previous year.

Remittance: Remittance inflows increased 12.6 percent to Rs.870.94 billion in the review period against a decrease of 3.2 percent in the same period of the previous year. In the US Dollar terms, remittance inflows increased 10.4 percent to 7.39 billion in the review period against a decrease of 5.2 percent in the same period of the previous year.

The number of Nepali workers (institutional and individual-new and legalized) taking approval for foreign employment decreased 59.9 percent in the review period. It had decreased 12.4 percent in the same period of the previous year. The number of Nepali workers (Renew entry) taking approval for foreign employment decreased 47.1 percent in the review period. It had decreased 31.1 percent in the same period of the previous year.

BOP position: Balance of Payments (BOP) registered a deficit of Rs.15.15 billion in the review period against a surplus of Rs.179.37 billion in the same period of the previous year. In the US Dollar terms, the BOP recorded a deficit of 140.8 million in the review period against a surplus of 1.50 billion in the same period of the previous year.

Exchange rate: Nepalese currency vis-à-vis the US Dollar appreciated 3.2 percent in mid-June 2021 from mid-July 2020. It had depreciated 9.7 percent in the same period of the previous year. The buying exchange rate per US Dollar stood at Rs.116.62 in mid-June 2021 compared to Rs.120.37 in mid-July 2020.

Government expenditure and revenue: In the review period, the total expenditure of the federal government according to data of the Financial Comptroller General Office (FCGO), Ministry of Finance, stood at Rs.916.85 billion. The recurrent expenditure, capital expenditure, and financing expenditure amounted to Rs.700.61 billion, Rs.143.09 billion, and Rs.73.15 billion respectively in the review period.

In the review period, revenue mobilization (including the amount to be transferred to provincial and local governments) stood at Rs.812.35 billion. The tax revenue and non-tax revenue amounted Rs.758.38 billion and Rs.53.98 billion respectively in the review period.

Banking:

- Deposit collection and Credit distribution: Deposits at Banks and Financial Institutions (BFIs) increased 15.3 percent in the review period compared to a growth of 13.3 percent in the corresponding period of the previous year. On y-o-y basis, deposits at BFIs expanded 20.8 percent in mid-June 2021.

Private sector credit from BFIs increased 24.9 percent in the review period compared to a growth of 10.7 percent in the corresponding period of the previous year. On y-o-y basis, credit to the private sector from BFIs increased 26.3 percent in mid-June 2021.

-Interest rates: The average base rate of commercial banks decreased to 6.66 percent in the eleventh month of 2020/21 from 8.66 percent a year ago. The weighted average deposit rate and lending rate of commercial banks stood at 4.72 percent and 8.46 percent respectively in the review month. Such rates were 6.17 percent and 10.43 percent respectively a year ago.