The report released on Tuesday has attributed the BoP surplus, which is a sharp improvement when compared with deficit of Rs 5.89 billion recorded for the same period last year, to rise in remittance flow and improvement in service accounts, among others.[break]
“Nepal received workers remittances worth Rs 47.32 billion, recording a sharp growth of about 25 percent as compared to figures of the same period of last year,” the report states.
Despite rise in remittance flow and money supply, inflation went down by a notch -- thanks to low growth in the prices of food items. According to the central bank, prices of food items in mid-September grew by 10.1 percent, contrary to 12.2 percent rise of the same period last year.
Mainly the drop in prices of legumes (by 4.1 percent), spices (by 10.5 percent) and hard drinks (by 2.2 percent) dragged down the prices of food and beverages.
Prices of vegetables, fruits and milk products and eggs, however, jumped by more than 49 percent, 38 percent and 13 percent respectively, burning holes in consumers´ pockets.
“Prices of non-food and services also grew by 7.2 percent in mid-September 2011, compared to 5.6 percent of the same period last year,” states the report.
The report also shows encouraging figures on exports front. For instance, the report says Nepal´s exports over the first two months of 2011/12 grew by about Rs 2 billion and touched Rs 12.48 billion. It had dropped by almost a billion rupee in the same period last year.
However, imports also grew by around Rs 9 billion to Rs 69.91 billion. As a result of this sharp rise in imports compared to exports, country´s trade deficit widened to Rs 57.43 billion.
Country´s total foreign currency holding, meanwhile, rose by over 10 percent and stood at Rs 300.14 billion.
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