Commercial banks in Nepal have reduced their interest rates by an average of 0.26 percentage points for the period between mid-October and mid-November.
According to their latest announcements, banks have set the personal fixed deposit rate at 5.20 percent for the new Nepali month starting Saturday, down from 5.46 percent in the previous month. Among the 20 commercial banks, 14 have revised their rates, while six have maintained last month’s rates unchanged.
Over the past year, banks and financial institutions (BFIs) have been consistently lowering interest rates, attributing the move to excess liquidity in the financial system. Currently, BFIs are holding over Rs 1.15 trillion in surplus liquidity, primarily due to weak loan demand and declining investor confidence in the market.
