KATHMANDU, Dec 13: The US dollar climbed to a record high of Rs 144.37 on Saturday, intensifying pressure on Nepal’s import-dependent economy. According to Nepal Rastra Bank, the selling rate stood at Rs 144.97, up from Rs 144.90 on Friday.
Market analysts attribute the surge to the relative strength of the US economy and sustained high interest rates set by the US Federal Reserve, which have boosted global demand for the dollar as a safe-haven asset. The weakening Indian rupee has further compounded the impact on Nepal, as the Nepali rupee is pegged to the Indian currency.
A stronger dollar raises the cost of key imports, including fuel, medicines, industrial raw materials and agricultural goods, fuelling inflation and increasing living costs. It also makes foreign debt servicing and international payments more expensive for both the government and the private sector.
Gold prices hit record high this week attributing to fluctuatio...
However, higher dollar rates provide some relief through remittances, which rise in local currency terms. Nepal Rastra Bank says foreign exchange reserves remain sufficient to cover imports, but stresses the need for export promotion, import management and prudent exchange rate policies to ease long-term pressure.
Other major currencies showed mixed movement. The euro appreciated, while the pound sterling declined. Several currencies, including the Swiss franc, Singapore dollar, Australian dollar and Chinese yuan, strengthened, while the Korean won weakened.
Gold prices also rose amid dollar strength. International gold reached USD 4,300.4 per ounce on Saturday. In the domestic market, gold climbed to Rs 256,600 per tola on Friday, up Rs 3,500 in a day, according to the Federation of Nepal Gold and Silver Dealers’ Association.
The impact of higher US tariffs on India is adding to regional pressure. With the Nepal–India exchange rate fixed, costlier imports via India further burden Nepal. India has responded through market intervention, liquidity measures and monetary policy adjustments, including selling dollars and cutting interest rates to support the rupee.
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