Thursday, October 10th, 2024

Economic Digest: Nepal’s Business News in a Snap


20 August 2024  

Time taken to read : 8 Minute


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KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.

In recent economic updates, Nepal has observed varied trends across different sectors.

The gold market showed volatility, with prices falling by Rs 300 per tola from a peak, while silver prices remained stable.

This suggests shifting market dynamics and a divergence in behavior between these precious metals.

Meanwhile, the country saw a decline in petroleum and steel imports, alongside a notable increase in machinery imports.

Real estate transactions surged in Shrawan, leading to a revenue collection of Rs 3.83 billion, despite a slight decrease in overall revenue compared to the previous year.

Additionally, Nepal’s foreign currency reserves soared by 32.6%, reaching Rs 2.041 trillion, bolstered by a strong remittance inflow.

Lastly, the NLPFA’s reduction in egg prices by up to Rs 75 per crate aims to adjust to market conditions, coupled with the introduction of branded cartons for improved traceability.

Gold price drops

The Nepalese gold market experienced a reduction of Rs 300 per tola, bringing the price down to Rs 152,300 per tola from the peak of Rs 152,600 per tola reached on Sunday, which had marked the highest price ever recorded.

This decrease highlighted the volatility in gold prices, reflecting potential market adjustments or shifting demand dynamics. In contrast, the price of silver remained unchanged at Rs 1,810 per tola, indicating a period of stability in silver compared to the recent fluctuations in gold values.

This divergence underscored the different market behaviors for these precious metals, with gold experiencing notable volatility while silver maintained a steady price point.

Nepal sees decline in petroleum and steel imports; machinery imports rise

In the fiscal year 2023/24, petroleum products constituted 18.87% of Nepal’s total imports, amounting to Rs 354 billion out of a total import value of Rs 1.592 trillion.

This represents a 2.9% decline from the Rs 397 billion spent in the previous fiscal year.

Imports of iron and steel also fell by 11.8%, from Rs 167 billion to Rs 147 billion, making up 9.26% of total imports.

Notable price decreases were observed across several categories: petroleum products (-2.96%), iron and steel (-11.84%), grains (-19.12%), medicine (-5.62%), gold (-40.87%), and others.

Conversely, imports of machinery and spare parts rose by 8.8%, totaling Rs 190 billion, while the import of crude soybean oil plummeted by 62.3% to Rs 13.41 billion.

Imports of electric and electronic materials increased by 7.3%, while gold imports fell by 40.9%.

Real estate transactions rise in Shrawan; revenue hits Rs 3.83 billion

Real estate transactions increased in Shrawan (mid-July to mid-August) compared to the same period last fiscal year, with 43,835 property transfers approved this year, up from 39,263 last year.

Land revenue offices provided 127,000 real estate services in the first month of the fiscal year, reflecting a slight rise from the previous year despite a decrease from Ashar.

Significant activity was noted in Jhapa, Morang, and Saptari districts, with total revenue of Rs 3.83 billion collected, including Rs 2.55 billion from registration.

Service tax contributed Rs 260 million and capital gains tax Rs 1.34 billion, compared to Rs 2.91 billion collected during the same month last year.

Nepal’s foreign currency reserves soar 32.6% to Rs 2.041 trillion

Nepal’s gross foreign currency reserves surged 32.6% to Rs 2.041 trillion by mid-July, up from Rs 1.539 trillion a year earlier, according to the Nepal Rastra Bank’s latest report.

This increase reflects an addition of Rs 502 billion over the past year.

The reserves are held predominantly by NRB (Rs 1.848 trillion) and banks (Rs 192.55 billion), with Indian currency comprising 22.5% of the total. In US dollar terms, reserves rose 30.4% to $15.27 billion.

These reserves can cover 15.6 months of merchandise imports or 13 months of combined merchandise and services imports.

The reserve-to-GDP ratio climbed to 35.8%, up from 28.8% a year ago.

Remittances contributed significantly, totaling Rs 1.445 trillion, though growth slowed to 16.5% from 23.2% in FY 2022/23.

NLPFA reduces egg prices by up to Rs 75 per crate; introduces new cartons

The Nepal Layers Poultry Farmers Association (NLPFA) has reduced egg prices by Rs 25 to 75 per crate, effective Monday.

The new prices are Rs 500 per crate for XL eggs, Rs 485 for large eggs, and Rs 415 for medium eggs, down from Rs 530, Rs 510, and Rs 490 respectively, set on July 12.

The NLPFA bases prices on production costs, demand, and supply.

Additionally, the association will now use branded cartons with farm information for egg transport instead of plain ones.

Real estate transactions increase

Real estate transactions increased in Shrawan (mid-July to mid-August) compared to the same period last fiscal year, with 43,835 property transfers approved this year, up from 39,263 last year.

Land revenue offices provided 127,000 real estate services in the first month of the fiscal year, reflecting a slight rise from the previous year despite a decrease from Ashar.

Significant activity was noted in Jhapa, Morang, and Saptari districts, with total revenue of Rs 3.83 billion collected, including Rs 2.55 billion from registration.

Service tax contributed Rs 260 million and capital gains tax Rs 1.34 billion, compared to Rs 2.91 billion collected during the same month last year.Real estate transactions increased in Shrawan (mid-July to mid-August) compared to the same period last fiscal year, with 43,835 property transfers approved this year, up from 39,263 last year.

Land revenue offices provided 127,000 real estate services in the first month of the fiscal year, reflecting a slight rise from the previous year despite a decrease from Ashar.

Significant activity was noted in Jhapa, Morang, and Saptari districts, with total revenue of Rs 3.83 billion collected, including Rs 2.55 billion from registration.

Service tax contributed Rs 260 million and capital gains tax Rs 1.34 billion, compared to Rs 2.91 billion collected during the same month last year.

Foreign currency rates fall, except for Australian dollar

The Nepal Rastra Bank has announced the foreign currency exchange rates for today (Tuesday). Most currencies, including the US Dollar, Euro, British Pound, and Kuwaiti Dinar, have seen a decrease in value compared to yesterday.

The US Dollar is being bought at NPR 133.90 and sold at NPR 134.50, down from NPR 134.01 and NPR 134.61 respectively.

The Euro is being bought at NPR 147.77 and sold at NPR 148.43, slightly down from NPR 147.79 and NPR 148.45.

The British Pound is being bought at NPR 173.35 and sold at NPR 174.13, down from NPR 173.48 and NPR 174.25.

Conversely, the Australian Dollar has appreciated, with a buying rate of NPR 89.64 and a selling rate of NPR 90.04, up from NPR 89.37 and NPR 89.77.

The Kuwaiti Dinar is being bought at NPR 438.04 and sold at NPR 440.00, down from NPR 438.80 and NPR 440.77.

(Prepared by Srija Khanal)

Publish Date : 20 August 2024 08:11 AM

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