Kathmandu, March 31:

Due to relatively higher growth of government expenditure in the current year, the budget has also posted Rs 6.18 billion deficit in the first seven months. In the same period last year, the budget was at the surplus of Rs 1.82 billion, according to the current macroeconomic situation based on the first seven months of this fiscal year.

However, the revenue mobilisation has increased by 29 per cent to Rs 54.52 billion compared to an increase of 17.9 per cent in the corresponding period last year. The NRB report also states that domestic credit has increased by 12.6 per cent in comparison to a growth of 2.3 per cent last year. A significant rise in domestic credit was on account of a pick up in bank credit to the private sector.

The NRB has injected a net liquidity of Rs 42.16 billion by net purchase of $660.6 million from commercial banks through foreign exchange intervention in the review period.

A net liquidity of Rs 37.17 billion had been injected through the net purchase of $510.8 million in the same period last year.

Total exports declined by three per cent that is equal to the decline in the corresponding period last year.

“Of the total exports, export to India fell by 5.5 per cent in comparison to a decline of 4.6 per cent in the same period last year,” according to the central bank. Exports to other countries, on the other hand, posted a growth of 2.5 per cent in comparison to an increase of 0.7 per cent in the comparable period last year.

However, total imports rose by 11.9 per cent compared to a rise of just 1.6 per cent in the corresponding period last year, states the NRB report.

The year-on-year inflation moderated to 6.4 per cent in mid-February 2008 from eight per cent in the same period last year.

“Likewise, the appreciation of Nepali currency against the US dollar also dampened the inflationary pressure,” it states.

Indian currency equivalent to Rs 50.23 billion was purchased through the sale of $790 million in the review period. During the same period last year, a total of Rs 30.49 billion.