KATHMANDU: Nepal’s gross foreign exchange reserves increased 26.2 percent to reach Rs 1942.4 billion in mid-May 2024 which was Rs 1539.36 billion in mid-July 2023, according to the latest report of Nepal Rastra Bank (NRB).

Of the total foreign exchange reserves, reserves held by NRB increased 28 percent to Rs 1722.02 billion in mid-May 2024 from Rs 1345.78 billion in mid-July 2023, the central bank reported in the Current Macroeconomic and Financial Situation Report based on ten months of data of FY 2023/24 released on Monday.

Reserves held by banks and financial institutions (except NRB) increased 13.8 percent to Rs 220.38 billion in mid-May 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-May 2024, added the report.

Based on the imports of ten months of 2023/24, the foreign exchange reserves of the banking sector is sufficient to cover the prospective merchandise imports of 15.1 months, and merchandise and services imports of 12.6 months.

Likewise, remittance inflow in the country has increased at a sustained rate of around 20 percent due to the robust exchange rate of the US dollar and few other reasons, added the central bank.

According to the report, the country received Rs 1198.6 billion in remittance in the first ten months of the current fiscal year 2023/24. NRB said remittance inflows increased 19.2 percent compared to an increase of 23.4 percent in the same period of the previous year.

In terms of the US dollar, remittance inflows increased 17.1 percent to 9.02 billion in the review period compared to an increase of 13.4 percent in the same period of the previous year, the central bank said.    

During the review period, the number of Nepali workers taking approval for foreign employment stood at 374,887 and those taking approval for renew entry stood at 237,893. In the previous year, the numbers were 421,279 and 238,976 respectively.    

According to the central bank, the current account remained at a surplus of Rs 193.25 billion during the review period against a deficit of Rs 63.74 billion in the same period of the previous year.    

Similarly, the Balance of Payments (BOP) remained at a surplus of Rs 392.64 billion in the review period against a surplus of Rs 209.49 billion in the same period of the previous year.    

In the review period, the net foreign direct investment (FDI) remained positive at Rs 6.98 billion. In the same period of the previous year, the net FDI was Rs 4.36 billion, the NRB stated in its report.