Kathmandu, May 23, 2022
The US dollar is now rising against the Nepalese rupee. The current exchange rate for one US dollar is Rs 124.38. Six months ago, though, the exchange rate was approximately Rs 119.
However, not only the Nepali currency, but all international currencies are now losing ground versus the dollar.
However, the US currency is not just gaining at the present; the rise in US bank interest rates is also a wake-up call for many emerging economies, including Nepal. However, the rise of the US dollar is not the primary cause of the global economic crisis. It is, nevertheless, adding to the problems of the international economy.
Many countries, including Nepal, do international business with US dollars. Nepal pays in
dollars for whatever it purchases from other countries. Dollars should be used to pay for
petroleum products, gold, silver, industrial raw materials, edible oil, and other imported items.
Paying for these things produces more cash than ever before when the dollar climbs. This
means that Nepal’s whole foreign exchange reserves will not be available until the dollar strengthens.
Nepal, on the other hand, benefits from remittances from abroad when the US dollar
appreciates against the Nepalese rupee. Nepal will profit from exports in addition to
remittances going into the strengthening dollar. When exports are lower than imports,
however, the dollar becomes more costly due to foreign trade, which does not appear to
benefit Nepal directly.
