Nepal's Eight-Month Economic Report (2025/26): A Full Data Breakdown
The Nepal Rastra Bank (NRB) has released its eight-month economic report for fiscal year 2025/26 (mid-July 2025 to mid-March 2026). This comprehensive report covers key macroeconomic indicators including inflation, trade, remittances, foreign exchange reserves, and GDP projections. Here is a full breakdown of the data.
GDP and Economic Growth
Nepal's GDP growth for fiscal year 2025/26 is projected at 3.99%, a notable improvement from the 3.36% growth recorded in 2024/25. The government's target was 6%, indicating that while growth is improving, it remains below ambitions set in the national budget.
- GDP Growth (2025/26 projected): 3.99%
- GDP Growth (2024/25 actual): 3.36%
- Government Target: 6.0%
Inflation Data (CPI – Consumer Price Index)
Nepal's headline inflation for the 8-month period (mid-July 2025 to mid-March 2026) averaged 2.13% year-on-year. Monthly breakdown:
- Mid-July to Mid-August 2025: 1.68%
- Mid-August to Mid-September 2025: 1.87%
- Mid-September to Mid-October 2025: 1.47%
- Mid-October to Mid-November 2025: 1.11%
- Mid-November to Mid-December 2025: 1.63%
- Mid-December 2025 to Mid-January 2026: 2.42%
- Mid-January to Mid-February 2026: 3.25%
- Mid-February to Mid-March 2026: 3.62%
The trend shows a clear upward trajectory in inflation in recent months, with mid-March 2026 recording the highest monthly figure at 3.62%.
Province-Wise Inflation (Mid-March 2026)
Inflation varied significantly across Nepal's provinces:
- Koshi Province: 3.96%
- Madhesh Province: 4.95% (highest)
- Bagmati Province: 3.31%
- Kathmandu Valley: 3.64%
- Gandaki Province: 2.87%
- Lumbini Province: 4.21%
- Karnali Province: 2.21% (lowest)
Madhesh Province recorded the highest inflation at 4.95%, while Karnali Province had the lowest at 2.21%.
Balance of Payments (BoP)
Nepal's external sector showed a strong surplus during the 8-month period:
- Current Account Surplus: Rs. 552,847.68 million (approximately $3.875 billion)
- This reflects robust remittance inflows and improved export performance
Foreign Employment and Remittances
Labor migration data for 8 months of 2025/26 shows a general decline in outmigration compared to the previous year:
- UAE: 70,706 workers (-43.34% year-on-year)
- Saudi Arabia: 39,922 workers (-22.37%)
- Malaysia: 29,955 workers
- Qatar: 29,439 workers (-11.76%)
- Kuwait: 21,473 workers (-17.57%)
The sharp decline in migration to the UAE (-43.34%) is the most significant trend, potentially reflecting tightening labor policies in the destination country.
Tourism
Tourist arrivals showed strong growth in early 2026:
- January 2026: 92,573 arrivals (+15.7% year-on-year)
- February 2026: 105,441 arrivals (+8.8% year-on-year)
Nepal's tourism recovery continues to gain momentum, with double-digit growth in January reflecting strong seasonal demand.
Key Takeaways
The eight-month economic data paints a mixed but broadly positive picture for Nepal's economy in 2025/26. GDP growth is improving, the balance of payments shows a healthy surplus, and tourism is rebounding strongly. However, rising inflation — particularly in Madhesh and Lumbini provinces — and declining labor outmigration are concerns that policymakers need to monitor closely.