Nepal Rastra Bank (NRB) has released the third quarter review of the Monetary Policy for the fiscal year 2081/82 (2024/25) following its Board of Directors' meeting on Sunday. The review highlights six major points focusing on interest rates, liquidity, credit risk weights, and regulatory updates.

The central bank stated that it has maintained a cautious balance in the policy direction, considering the current domestic economic and financial conditions. The key policy rate remains unchanged at 5.0%, the deposit collection rate at 3.0%, and the bank rate — the upper limit of the interest rate corridor — is held steady at 6.5%.

In addition, the existing ratios for the Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CRR) have been kept unchanged. However, a new provision will now require banks and financial institutions to maintain at least 90% of the mandatory daily cash reserve.

One of the most investor-friendly changes is the reduction of the risk weight on share-backed loans from 125% to 100%. This is expected to provide significant relief to share investors and positively influence market sentiment.

To further improve the investment climate, the NRB announced it will soon issue a revised regulation titled “Foreign Investment and Foreign Loan Management Bylaws, 2078”. This will incorporate recent amendments made to the Foreign Exchange Regulation Act, 2019 and the Foreign Investment and Technology Transfer Act, 2075.

Lastly, the central bank will formulate and implement new guidelines on dishonored cheques as per the amendments to the Banking Offense and Punishment Act, 2064. This aims to streamline the verification and enforcement processes related to bounced cheques.

Overall, the review sends a strong signal of market-friendly reform while focusing on liquidity management, investor confidence, and regulatory clarity — a move welcomed by financial analysts and stock market participants alike.