Nepal Rastra Bank (NRB) has responded to the accumulation of excess liquidity in the banking system by issuing another reverse repo. After previously issuing reverse repos on two separate occasions, NRB has now introduced Rs. 20 Arba on Tuesday. The reverse repo is a monetary tool utilized to absorb surplus liquidity and bring stability to the system. Considering there is approximately Rs. 40 Arba of excess liquidity in the system, this marks the fourth reverse repo issued by NRB during the current financial year.
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