Liquidity Crisis Will Deteriorate in Poush, says Governor 

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 Liquidity Crisis Will Deteriorate in Poush, says Governor 


December 14: Governor of the Nepal Rastra Bank Maha Prasad Adhikari said liquidity crunch will aggravate in the month of mid- December to mid-January (Poush).
 

Speaking at the Thirteenth Anniversary of Nepalese Association of Financial Journalists held in Kathmandu on Wednesday, Governor Adhikari reiterated that banks and financial institutions would have to experience further scarcity of the loanable amount next month.
 

“Some tax gets collected in the government coffers in Poush. As per the calendar, Rs 30 billion will go into the government’s account. This will have an adverse effect in the state of cash flow next month. But, we are working to ease the shrinking liquidity”, Adhikari added.

 

According to Adhikari, the central bank had injected 970 billion in the market to ease liquidity last year. “Despite a lot of efforts by the NRB, liquidity is yet to ease in the market”, he stated.

 

Due to the increasing remittance flow inside the country, state of liquidity has become a bit comfortable at present, according to Adhikari 
 

Adhikari stressed the need of money recycling to make liquidity available in the market. “If the borrowers return some money to the banks, cash flow will rise”, Adhikari said. He blamed the  ballooning trade deficit for liquidity crunch. 
 

Adhikari made it clear that the  central bank was ready to have an open discussion and forge collaboration with the private sector. “Nepal Rastra Bank has opened the import of banned goods and is enforcing various policies and tools to balance the economy”, Adhikari held. 
 

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