According to dealers, sale of gold jewelries have come down by more than 90 percent after the earthquake.
"Every day gold dealers are seeing customerslooking to sell their jewelries," Mani Ratna Shakya, president of Federation of Nepal Gold and Silver Dealers' Associations,told Republica, adding: "It is natural for people, who lost their homes due to the earthquake, to sell their valuable assets."The deadly earthquake that jolted the country on April 25 and subsequent aftershockshave damaged more than 300,000 houses across the country.
Dealers say the selling spree of gold is due to massive destruction of houses due to the quake.
"People who lost their homes are selling gold jewelries to rebuild their homes and meet their daily needs," he said, adding that selling spree has been seen throughout the country.
According to Shakya, the selling spree would continue in Kathmandu Valley for at least six months and out of the Valley for around three months. "This trend does not bode well for the bullion industry. We had witnessed similar trend for almost a year after the royal massacre of 2001," he added.
He also refuted suggestions that gold dealers are shutting down their shops to avoid customers looking to sell gold jewelries. "Some dealers with low capital, however, might have done so," he added.
Such is the selling spree that dealers have stopped buying gold from commercial banks. As a result, huge volume of gold is lying idle with different commercial banks.
"There is no point purchasing gold from banks as dealers themselves as huge volume of gold in stock. We are buying gold from consumers as they are in big crisis," added Shakya.
Nepal Rastra Bank (NRB) has allowed commercial banks to sell a maximum of 15 kg of gold to dealers on a daily basis. The allocated quota is sold to dealers through 16 commercial banks.
Shakya also attributed drop in gold sale to cancellation of weddingsdue to the earthquake.
Meanwhile, Tej Ratna Shakya, immediatepast presidentof the federation,said increasing price is also affecting sale of gold jewelries. "As price of gold is increasing, consumers are selling their jewelries instead of making fresh purchase," said Tej Ratna.
Due to strong dollar, gold price has increased notably in domestic and international market. According to traders, gold is being traded at one-month high of Rs 53,000 per tola (11.664 grams). Price of gold,which was traded at $1,163 per troy ounce in the international market on Wednesday, increased to$1,215per troy ounce on Thursday.
Related story
NRB begins selling gold and silver coins for Tihar
