NRB Absorbs Over NPR 315 Trillion Liquidity in Seven Months

Kathmandu – In the first seven months of the current fiscal year 2025/26 (FY 2082/83), Nepal Rastra Bank (NRB) has absorbed a significant amount of liquidity from the banking system through various monetary management tools. According to the central bank, a total net liquidity absorption of NPR 315.86 trillion was carried out during the review period through transaction-based instruments.NRB reported that NPR 16.06 trillion was absorbed through deposit collection auctions, NPR 297.92 trillion through the Standing Deposit Facility, and NPR 2 trillion through NRB bonds, totaling NPR 315.99 trillion in liquidity absorption. Meanwhile, NPR 12.50 billion was injected into the banking system through overnight liquidity facilities. After adjusting these transactions, the net liquidity absorption stood at NPR 315.86 trillion.In comparison, during the same period of the previous fiscal year, only NPR 148.58 trillion in liquidity had been absorbed through similar monetary management instruments, indicating a substantial increase in liquidity management activities this year.During the review period, the central bank also intervened in the foreign exchange market by purchasing a net amount of USD 3.96 billion, injecting liquidity worth NPR 564.04 billion into the market. In the same period last year, NRB had purchased USD 2.87 billion, injecting NPR 387.56 billion into the banking system.Additionally, NRB sold USD 2.26 billion and purchased Indian currency worth NPR 321.96 billion during the period. In the previous year’s corresponding period, USD 2.24 billion had been sold to purchase Indian currency worth NPR 303.70 billion.Interbank transactions, however, declined during the review period. Transactions among commercial banks amounted to NPR 559.86 billion, while those among other financial institutions totaled NPR 76.36 billion, bringing the total interbank transactions to NPR 636.22 billion. In the same period last year, interbank transactions had reached NPR 1.04 trillion.