Monetary Policy made public: Bank rate decreases by 1 percent

KATHMANDU, May 12: The Central Bank has reviewed the monetary policy of the current financial year 2079/80 up to the third quarter (mid-April). While reviewing the monetary policy of the third quarter on Friday, the bank has taken some flexible policies. The Central Bank has taken a loose monetary policy in accordance with the wishes of the finance minister reducing the bank rate by 1 percent through the review of the third quarter to 7.5 percent, which was previously 8.5 percent.

Keeping the policy rate unchanged at 7 percent, the existing bank rate has been reduced by 1 percentage point to 7.5 percent, the bank said. However, the monetary policy has kept the other rates under the interest rate corridor the same. The daily liquidity facility, which was being provided at the bank rate of 8.5 percent, had been arranged to be provided at the policy rate of 7 percent from the half-yearly review. As a result, the interbank interest rate has decreased by 1.5 percentage points. The bank has continued to provide daily liquidity facilities at policy rates.