Reserves-to-GDP Ratio Climbs to 45.9%: Nepal’s Macro Stability at a High

Nepal’s foreign exchange reserves have reached a new milestone, with the reserves-to-GDP ratio rising to 45.9 percentas of mid-August 2025/26 — the highest in several years. This surge reflects the country’s strengthened external position, driven by robust remittance inflows, improved current account surplus, and controlled import expenditure.

According to the latest data from Nepal Rastra Bank (NRB), the nation’s total reserves climbed to Rs. 2.95 trillion, marking a 4.8% monthly increase and a sharp rise from Rs. 2.68 trillion in the same period last year. The growth in reserves has provided a strong buffer for the Nepali economy amid global uncertainties, ensuring exchange rate stabilityand liquidity support for imports.

Economists say this ratio highlights Nepal’s macro stability and policy success in managing the external sector. The reserves are now sufficient to finance over 20 months of merchandise imports and nearly 17 months of goods and services imports — far above international adequacy norms. However, analysts caution that the improvement is largely inflow-driven, with limited contribution from export earnings or FDI. Sustaining this level will require diversifying income sources, encouraging productive investment, and strengthening export competitiveness.