NRB lowers Policy Rate to 6.5% in 202023-24 monetary policy announcement

KATHMANDU: Nepal Rastra Bank unveiled its monetary policy for the current financial year 2023-24 on Sunday, featuring a significant reduction in the policy rate. The policy rate has been lowered to 6.5 percent, down from the previous rate of 7 percent.

The reduction in the policy rate is expected to have a direct impact on short-term loans acquired by banks from the National Bank, leading to a potential decrease in overall interest rates. As a result, there may be pressure on banks to lower interest rates for their borrowers.

The bank rate limit, which stands at 7.5 percent, remains unchanged. This rate is applied by the National Bank when providing loans to banks for liquidity management purposes.

Furthermore, the deposit collection rate has been maintained at a rate of 4.5 percent, down from the previous rate of 5.5 percent.

The new monetary policy aims to address economic challenges and create a conducive environment for sustainable growth in the country. The changes in interest rates are expected to play a crucial role in stimulating economic activities and promoting investment opportunities in Nepal.