KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
The NEPSE index on Tuesday rebounded by 1.33% to 2,696.65 points, following a previous decline, with 329 stocks traded in 206,643 transactions and a turnover of Rs 17.26 billion.
Meanwhile, gold prices dropped by Rs 100 per tola, with fine gold at Rs 146,000 and standard gold at Rs 145,000. In Bhaktapur, tourist arrivals increased by 46.49% in the fiscal year 2023/24, resulting in Rs 274.45 million in tourism fees.
Additionally, Nepal Rastra Bank (NRB) enacted new regulations for microfinance institutions to lower service fees, cap interest rates, and adjust loan default criteria, aiming to reduce high service charges and better handle borrower defaults.
NEPSE index surges 1.33 percent in Tuesday’s trading session
The Nepal Stock Exchange (NEPSE) index on Tuesday rose by 1.33 percent, closing at 2,696.65 points, which is an increase of 35.55 points from the previous trading day’s close.
This positive movement follows yesterday’s downturn, where the index fell by 20.46 points.
The trading day began with the index opening at 2,669.41 points.
During the session, it reached an intraday low of 2,609.02 points and an intraday high of 2,709.89 points before ending at the closing value.
Today’s trading saw 329 stocks being exchanged through 206,643 transactions, resulting in a total volume of 40,371,778 shares.
This activity produced a notable turnover of Rs. 17.26 billion, with the market capitalization for the day at Rs. 4.278 trillion and the float market capitalization at Rs. 1.478 trillion.
Gold prices drop
The domestic gold market on Tuesday experienced a decrease of Rs 100 per tola, with fine gold priced at Rs 146,000 per tola and standard gold at Rs 145,000 per tola, according to the Nepal Gold and Silver Dealers’ Association.
This drop followed Monday’s rates, where fine gold was valued at Rs 146,100 per tola and standard gold at Rs 145,300 per tola.
The Rs 100 reduction per tola indicated a slight downward adjustment in gold prices, potentially due to shifting market dynamics, fluctuations in demand, or broader economic factors. Additionally, silver prices were set at Rs 1,740 per tola.
Bhaktapur sees 46% surge in tourist arrivals
In fiscal year 2023/24, Bhaktapur experienced a significant 46.49% rise in tourist arrivals, reaching 245,593 visitors, up from 167,652 in the previous year.
This included 116,401 non-SAARC tourists and 129,192 from SAARC countries and China.
The municipality earned over Rs 274.45 million in tourism fees, with Rs 209.99 million from non-SAARC visitors and Rs 6.46 million from SAARC and China.
This compares to Rs 184 million in the previous fiscal year. Notably, 87,798 visitors were from India and 40,401 from China.
NRB limits microfinance fees, caps interest rates, and revises loan default criteria
Nepal Rastra Bank (NRB) has imposed new regulations on microfinance institutions (MFIs) to curb excessive service fees and surcharges.
As of Sunday, the maximum service fee charged by MFIs is reduced from 1.5% to 1.3%, and additional surcharges are prohibited.
This move addresses complaints about high service charges and interest rates, which have led to significant debt for many borrowers.
The updated monetary policy for 2024/25 also proposes a cap on MFI interest rates, currently as high as 15% annually.
Under the new provisions, households can now access collateral-free loans up to Rs 25,000 with family guarantees, and group-based loans for micro-enterprises have increased to Rs 700,000. Borrowers can now take loans from up to two MFIs.
Additionally, the NRB has refined the criteria for loan default, distinguishing between willful and non-willful defaulters before blacklisting. Willful defaulters include those who avoid contact, obstruct auctions, misuse funds, or submit fraudulent documents.
Foreign currency exchange rates
On Wednesday, the Nepal Rastra Bank announced the foreign currency exchange rates, showing stability for most major currencies, with a notable increase in the British pound.
The NRB has set the buying rate for one US dollar at 133.67 rupees and the selling rate at 134.27 rupees.
Similarly, the euro remains steady with a buying rate of 144.75 rupees and a selling rate of 145.40 rupees.
In contrast, the British pound has seen an increase, with its buying rate now at 171.79 rupees and the selling rate at 172.56 rupees.
The Qatari riyal remains stable as well, with a buying rate of 36.66 rupees and a selling rate of 36.82 rupees.
This adjustment reflects the NRB’s efforts to manage and stabilize the exchange rates amidst varying global economic conditions.
(Compiled and prepared by Srija Khanal)
Economic Digest is a daily morning economic digest, basically relatable summations of the most important business news, and happenings from Nepal into easy-to-understand summaries.
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