April 5: The current account of the government remained at a surplus of Rs 166.87 billion in the first eight months of the current fiscal year against a deficit of Rs 55.28 billion in the same period of the previous year.

According to the Current Macroeconomic and Financial Situation Report published by the Nepal Rastra Bank on Thursday, the current account in terms of the US dollar registered a surplus of 1.25 billion in the review period against a deficit of 429.3 million in the same period last year.

In the review period, capital transfer decreased 30.2 percent to Rs 3.89 billion and net foreign direct investment (FDI) remained a positive of Rs 5.63 billion. In the same period of the previous year, capital transfer amounted to Rs 5.58 billion and net FDI amounted to Rs 1.17 billion, the report added.

According to the NRB, the country’s Balance of Payments (BoP) remained at a surplus of Rs 327.55 billion in the review period against a surplus of Rs 142 billion in the same period of the previous year.

In terms of the US dollar, the BoP remained at a surplus of 2.46 billion in the review period against a surplus of 1.08 billion in the same period of the previous year.

Similarly, the gross foreign exchange reserves increased 21.7 percent to Rs 1872.82 billion in mid-March 2024 from Rs 1539.36 billion in mid-July 2023. In the US dollar terms, the gross foreign exchange reserves increased 20.8 percent to 14.14 billion in mid-March 2024 from 11.71 billion in mid-July 2023.

Of the total foreign exchange reserves, reserves held by NRB increased 22.2 percent to Rs 1644.06 billion in mid-March 2024 from Rs 1345.78 billion in mid-July 2023, the central bank’s report added. Meanwhile, the reserves held by banks and financial institutions (except NRB) increased 18.2 percent to Rs 228.76 billion in mid-March 2024 from Rs 193.59 billion in mid-July 2023. The share of Indian currency in total reserves stood at 22.1 percent in mid-March 2024.

Based on the imports of eight months of 2023/24, the foreign exchange reserves of the banking sector is sufficient to cover the prospective merchandise imports of 14.8 months, and merchandise and services imports of 12.4 months, the NRB stated.