The NEPSE Journal
Market commentary, data deep-dives, and trading notes from the NEPSE Trading desk.
Nepal’s total government expenditure reached Rs. 44B in mid-August 2025/26 — with recurrent spending still dominating and capital investment remaining low, raising concerns about fiscal efficiency and development momentum.
Nepal raised Rs. 40B in domestic borrowings in the first month of 2025/26, entirely via development bonds, reflecting fiscal pressures but also raising concerns about debt sustainability.
Provinces posted an Rs. 8.5B surplus due to high transfers and low spending, but this reveals capacity gaps rather than efficiency, raising concerns about the effectiveness of Nepal’s federal model.
Nepal mobilized Rs. 75.1B in revenue and grants in a single month, outpacing expenditure, but questions remain whether the government can sustain fiscal discipline in the long run.
Nepal’s government posted a budget surplus of Rs. 31.1B in mid-August 2025/26, driven by strong revenues and restrained spending — a rare but positive fiscal shift.
Despite record reserves of Rs. 2.95 trillion, Nepal’s net foreign assets fell by Rs. 89 billion in mid-August 2025/26 due to external payments, loan outflows, and valuation adjustments.
BFIs’ foreign reserves surged 12 percent to Rs. 294.6 billion in mid-August 2025, driven by remittance inflows and rising convertible assets, signaling a stronger role for commercial banks in Nepal’s external stability.
Nepal’s reserves-to-imports ratio jumped to 138.3%, ensuring one of the region’s safest foreign exchange buffers, though long-term sustainability depends on export-led growth and investment diversification.
Nepal’s reserves-to-GDP ratio has surged to 45.9%, signaling strong external stability and improved macroeconomic fundamentals, but experts warn that long-term sustainability hinges on export and investment growth.
