Monetary Policy announced by Central Bank

KATHMANDU, July 23: The Central Bank has published the monetary policy for the current fiscal year. After the Board of Directors meeting of the Central Bank passed the monetary policy on Sunday, it was made public through the website.

The monetary policy issued by the central bank has not implemented many of the old policies. Although it is said that the monetary policy will support the target of an economic growth rate of 6 percent of the budget of the current fiscal year, the policy of extensive investment has not been seen in the monetary policy.

Everyone had the goal of reducing the interest rate of the Bank and creating an investment environment with the monetary policy. However, the monetary policy has mostly kept the interest rate corridor unchanged by maintaining the current 12 percent money supply.

The central bank has made arrangements through the monetary policy to continue the 150 percent risk weight of auto loans, including real estate, and share securities loans, which were taken by the previous monetary policy.

These are the main policies of monetary policy:

- Given the internal and external economic scenario, the policy rate has been reduced by 50 basis points to 6.5 percent. Keeping the bank rate unchanged at 7.5 percent, the deposit collection rate has been reduced from 5.5 percent to 4.5 percent.

- If the weighted average interbank interest rate taken by this bank as an operating target is higher than the bank rate and lower than the deposit collection rate, the secondary market transactions and deposit collections will be opened.

- The provision of permanent liquidity facility at bank rate and overnight liquidity facility at policy rate has been maintained.

- To make the interest rate corridor effective, arrangements will be made to provide a permanent deposit collection facility at the lower limit of the interest rate corridor.

-Mandatory cash ratio and statutory liquidity ratio have been kept unchanged.