Kathmandu, February 17: Average inflation rate has increased to 6.41 percent in the first six months of the current fiscal year 2019/20, according to the ‘Current Macroeconomic and Financial Situation of Nepal’ released by Nepal Rastra Bank (NRB).
The rise in the inflation rate in Nepal during the review period is ascribed to a recent price hike in India.
“Since the southern neighbors is our largest trading partner, any fluctuation in consumer prices there directly affects our inflation rate, say the NRB sources.
Vegetables, spices, pulses and legumes and fruits have become dearer in the Nepali market during the first six months. “Similarly, within the non-food and service group, the prices of education, clothes and footwear, furnishing and household equipment increased to some extent during the review period,” states the central bank.
Meanwhile, merchandise export increased by 26.1 percent to Rs 57.28 billion in the first six months of the current fiscal year compared to an increase of 11.5 percent a year ago, according to the NRB.
In terms of destinations, exports to India rose by 45.8 percent, whereas exports to China and other countries decreased by 8.5 percent and 3.8 percent, respectively.
During the review period this year, merchandise import, however, dwindled by four percent to Rs 694.69 billion against an increase of 30.5 percent in the same period of the previous year.
Because of the rise in export and falling imports, the country’s total trade deficit narrowed down 6.1 percent to Rs 637.41 billion in the first half of 2019-20. Such deficit had expanded by 32 percent in the same period of the previous year. Nevertheless, the current account saw a deficit of Rs 84.71 billion in the review period.
Such deficit stood at Rs 152.16 billion in the same period of the previous year. The remittance inflow grew by 0.9 percent to Rs 447.26 billion in the review period compared to a rise of 30.2 percent in the same period of the previous year.
