Kathmandu: In a surprising turn of events, the US Dollar has surged to unprecedented levels against the Nepali rupee, setting a new record high, as reported by the Nepal Rastra Bank (NRB).
According to the latest data released by NRB on Wednesday, the buying rate for the US dollar has reached an all-time high of Rs 133.8, with the selling rate standing at Rs 133.68. This marks the highest exchange rate ever recorded for the US dollar in Nepal.
The surge in the dollar’s value comes on the heels of a previous peak on November 11 when the dollar reached Rs 133.65. This fluctuation in exchange rates has significant implications for Nepal’s economy.
While a stronger dollar can be beneficial for remittances from abroad, bolstering income and revenue in the tourism sector and export trade, the downside is felt due to Nepal’s import-dependent economy. The increased cost of importing goods, paid in dollars, results in economic losses.
The nation’s economy typically reaps rewards from a robust dollar through increased remittance income, tourism revenue, and export trade. However, the widening trade deficit, caused by higher imports than exports, negatively impacts the exchange rate and foreign exchange reserves.
The surge in the dollar’s value also has cascading effects on domestic prices. As the dollar rises, the cost of imported foreign goods increases, potentially leading to a rise in fuel prices. Moreover, the escalation in the dollar’s value contributes to an increase in Nepal’s foreign debt and interest payments.
The government and financial experts are closely monitoring the situation, as these developments in exchange rates have far-reaching consequences for various sectors of the economy. Stay tuned for further updates on this evolving economic scenario.