KATHMANDU: Interest rates of commercial banks have fallen further for the period from mid-October to mid-November.

The average maximum interest on individual fixed deposits dropped by 0.26 percentage points, falling from 5.46 percentage in mid-September to mid-October to 5.20 percentage in the current period.

The highest rate continues to be 6 percentage, offered by Global IME Bank and Himalayan Bank.

Among 20 banks, 14 reduced their rates while six kept them unchanged. No bank raised rates.

Short-term deposits continue to offer lower returns, whereas long-term deposits maintain relatively higher interest.

A decline in fixed deposit rates typically leads to reductions in both savings and lending rates.

The rate cuts come amid ample liquidity and sluggish credit demand.

Nepal Rastra Bank has also been absorbing short-term liquidity through deposit auctions.

The central bank’s current policy rate stands at 4.5 percentage, with the standing liquidity facility at 6 percentage and the standing deposit facility at 2.75 percentage.