Monetary Policy: Inflation to be contained at 6.50 Percent

Kathmandu / Aug. 13: The monetary policy has projected that the inflation would be contained at 6.50 per cent this year while the private sector credit is expected to grow by 19 per cent.

Publishing the monetary for the fiscal year 2021/22 on Friday, the Nepal Rastra Bank (NRB) announced its policy outlook.

To support the economic growth target, the monetary policy is focused on increasing the broad money (M2) by 18 per cent on the basis of the nominal GDP growth target.

The cash reserve ratio is to be maintained the same as in the past fiscal year, at 3 per cent.

The NRB has announced a review of the limit set for digital transaction payment through various tools to promote electronic transactions. It has also announced plans to reduce the tariff imposed in digital transactions.

Among other things, the NRB has announced the necessary facilitation to the government agencies to receive money through electronic payment. It has also announced plans to make payment of social security allowance through the electronic transaction system.

The Monetary Policy has announced a number of incentives for banks and financial institutions going for merger. It has also set a ceiling of Rs 120 million from banks against the deposit of shares.