“Nepal Rastra Bank Eliminates Rs 30 Billion to Manage Excess Liquidity”

On Sunday, Nepal Rastra Bank (NRB) wiped off Rs 30 billion from the market to address the issue of excess liquidity in the financial system. This action comes after NRB previously removed Rs 40 billion on Thursday and Rs 12.15 billion last Friday using its deposit collection mechanism.

The central bank’s decision to mop up funds was triggered by the interbank rate falling below three percent. According to NRB regulations, the central bank intervenes to absorb money from the market when the interbank rate drops below three percent and injects money into the market when the rate exceeds seven percent.

Commercial banks, development banks, and finance companies were eligible to participate in the bidding process, which was open until 12 noon on Sunday. This measure aims to stabilize the financial system by managing liquidity levels effectively.

Related posts