KATHMANDU, JUL 09 -
Though tradition has it that the monetary policy is introduced after the budget for a new fiscal year is announced, the Nepal Rastra Bank (NRB) is all set to introduce an early policy this year.

NRB Governor Yubaraj Khatiwada said on Friday the central bank is working to introduce the policy before the budget as it felt the delay in the budget should not hamper the policy. “There are many tasks the monetary authority can do without the budget,” he told business reporters. “The monetary policy introduced before the budget will be of ad hoc nature which will be adjusted as per the budget announcement,” he said.

With the government preparing an ‘approach paper’ for the three-year new interim plan, Khatiwada made it clear the central bank could bring the monetary policy even without the annual budget on the basis of the paper. Amid speculations that the monetary policy could be tighter due to the balance of payment (BoP) deficit, the governor said it would be balanced and will allow credit expansion as the economy needs. Khatiwada said the fiscal measures to be taken would accelerate the recovery of BoP deficit. As of 10 months of the current fiscal year, the BoP deficit climbed down to Rs. 17 billion from Rs. 22 billion. The government aims to take import substitute measures to improve the BoP situation in the budget. He predicted the deficit will zero soon, taking a positive direction with higher inflow of remittance as a result of global economic recovery.

Posted on: 2010-07-10 08:34

Post Your Comment

Please note that all the fields marked * are mandatory.

* Full Name

* Address

* Email Address

* Comment
[Some of the HTML tags you can use : <b>, <i>, <a>]

* Captcha

Get another CAPTCHA code