"During Tihar last year, dealers across the country were selling 40 kg of gold a day. But this year, they are selling just 15 kg a day," said Tej Ratna Shakya, president of Nepal Gold and Silver Dealers Association (Negosida).[break]
Though demand for gold coins and ornaments at present is as strong as the last year, traders said they have not been able to take orders coming their way because the central bank capped supply volume of gold to 15 kg a day.
"Festive buyers want us to supply them the products instantly, but we are simply not in a position to do that," said Shakya.
With festive buying and people coming on a shopping spree for new wedding season that starts next week, dealers said demand for gold in the market has jumped to 40 kg a day, more than double the quantity they receive from commercial banks.
"People buying gold for the upcoming wedding season are ready to wait for the delivery, but even then we are facing difficulty in managing the market," said Shakya.
Dealers have been complaining of short supply of gold since the onset of Dashain festival, when people received festive allowance and bonuses and rushed to buy jewelries. They even knocked on the doors of Nepal Rastra Bank (NRB) to relax its cap till the festive season and subsequently following wedding season end, but the central bank has not responded to them.
Following the scarcity, some of the dealers had even charged additional money to the customers to make the supply. Negosida officials told Republica that they found some dealers charging as much as Rs 1,000 higher for a tola (11.664 grams) than the officially set retail rates.
"We instantly intervened and such practice is now under control. But if the government continued to leave the market in jeopardy, we too will not be able to rein the situation," said Shakya, urging the central bank to raise the daily supply of gold to 30 kg a day for next one month.
Meanwhile, the price of the yellow metal continued to hover at Rs 60,500 per tola on Monday. In the international bullion market, gold was traded at US$ 1,734 per troy ounce.
Related story
Gold in short supply ahead of Teej
