Foreign Exchange Reserves Declines By 3.2 Percent: NRB

September 23, 2021 | Investopaper

The gross foreign exchange reserves decreased 3.2 percent to Rs.1353.82 billion in mid-August 2021 from Rs.1399.03 billion in mid-July 2021. In US Dollar terms, the gross foreign exchange reserves decreased 2.8 percent to 11.42 billion in mid-August 2021 from 11.75 billion in mid-July 2021.

Of the total foreign exchange reserves, reserves held by NRB decreased 3.1 percent to Rs.1206.51 billion in mid-August 2021 from Rs.1244.63 billion in mid-July 2021. Reserves held by banks and financial institutions (except NRB) decreased 4.6 percent to Rs.147.31 billion in mid-August 2021 from Rs.154.39 billion in mid-July 2021. The share of Indian currency in total reserves stood at 25.2 percent in mid-August 2021.

Exports & Imports Surge By 116 Percent & 76 Percent

During the first month of 2021/22, merchandise exports increased 115.9 percent to Rs.20.76 billion compared to an increase of 8.9 percent in the same period of the previous year. Destination-wise, exports to India, China, and other countries increased 167.0 percent, 47.8 percent, and 17.5 percent respectively. Exports of soyabean oil, palm oil, polyester yarn & thread, juice, oil cake, among others increased whereas exports of cardamom, medicine (ayurvedic), herbs, wire, readymade leather goods, among others decreased in the review
period.

During the first month of 2021/22, merchandise imports increased 75.7 percent to Rs.150.73 billion against a decrease of 19.6 percent a year ago. Destination-wise, imports from India, China, and other countries increased 58.7 percent, 87.6 percent, and 120.8 percent respectively. Imports of petroleum products, transport equipment & parts, crude soyabean oil, M.S. billet, gold, among others increased whereas imports of chemical fertilizer, cement, tobacco, aircraft spare parts, readymade garments among others decreased in the review period.

Based on customs points, exports from Kanchanpur, Mechi, and Nepalgunj Customs Offices decreased whereas exports from all other customs points increased in the review period. On the import side, imports from Kailali Customs Office decreased whereas imports from all other customs points increased in the review period.

The total trade deficit increased 70.6 percent to Rs.129.97 billion during the first month of 2021/22. Such a deficit had decreased 22.2 percent in the same period of the previous year. The export-import ratio increased to 13.8 percent in the review period from 11.2 percent in the same period of the previous
year.

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