Kathmandu [Nepal], July 8: Nepal’s central bank unveiled a flexible monetary policy for the upcoming fiscal year, aiming to support the government’s target of achieving 7 percent economic growth through higher lending, stronger private sector activity and sustained investment.
The Nepal Rastra Bank on Tuesday said the outlook for the 2026/27 fiscal year was favourable, citing proposed government policy reforms, improving business confidence and rising consumption and investment demand.
The central bank said the government’s 7 percent growth target was achievable, provided global economic conditions remain stable and investor confidence continues to improve. Inflation is projected to average around 5.5 percent during the fiscal year although risks remain from renewed geopolitical tensions and higher-than-expected inflation in India.
Governor Dr Bishownath Poudel said the monetary policy was designed to support the government’s economic growth agenda. He said banks and financial institutions have already extended nearly Rs 6 trillion in loans with an additional Rs 652 billion in lending expected in the coming fiscal year to help meet the growth target.
NRB spokesperson Guru Prasad Poudel said the monetary policy was intended to complement the government’s economic objectives and provide support for achieving the projected growth rate.
The policy also introduces measures to help revive distressed industries by allowing viable businesses to restructure and operate under new plans. It includes provisions to address non-performing loans linked to troubled industries.
In addition, the central bank said it would encourage banks and financial institutions to reduce operating costs through greater digitalisation with the aim of improving returns for customers.
