KATHMANDU, SEPTEMBER 26
The Nepali currency will depreciate further vis-à-vis the US dollar on Tuesday as the Indian currency continues to weaken against the dollar after the central bank of the United States hiked interest rates to control inflation.
According to the foreign exchange rate of the Nepal Rastra Bank (NRB) for Tuesday, each dollar will fetch Rs 130.90, tumbling by over a rupee compared to today's exchange rate of Rs 129.89, which was an alltime low as well.
As per experts, a high US dollar is likely to worsen the economic problems for the country by adding pressures on inflation, foreign debt and import bills. However, the scenario is also likely to create opportunities for the country to shift towards improving exports of domestic commodities and narrowing the trade deficit.
According to Reuters, the Indian rupee - with which the Nepali currency is pegged - sank to a new record low today, following the pound's tumble and fears over more aggressive monetary tightening, with traders saying the Reserve Bank of India (RBI) likely sold dollars to contain the decline.
The Indian rupee hit a record low of 81.5525 per dollar, down from 80.99 in the previous session. The intervention by the RBI was confirmed to Reuters by four traders.
"The reason the Indian rupee is managing to cling on to 81.50 is the RBI," a private bank trader said.
"But the supply of dollars by the RBI is getting easily absorbed."
A version of this article appears in the print on September 27, 2022 of The Himalayan Times.
