The price increased in the domestic market despite gold price going down in the domestic market. Gold was sold for $1,102 per troy ounce in international market on Monday, down from $1,109 recorded a day earlier. [break]
Tej Ratna Shakya, president of Nepal Gold and Silver Dealers´ Association said gold price went up in the domestic market amid confusion about the government´s policy on mode of import after the rise in duty.
“The rise in the price of gold is a short term one. It will gradually go down once the government comes up with specific policy on gold imports. I have requested the officials of the Finance ministry and the central bank to clear the confusion,” Shakya added.
Amid supply constraints in the market after the government imposed restriction on all ways of imports of gold, including hand carry, traders said, the price will further go up if the government failed to devise clear policy on imports at the earliest.
Gold dealers are pressing the government to allow daily imports of at least 20-25 kg through hand-carry to ease supply in the domestic market, which is showing inconsistency with the international bullion market.
Responding to rise in customs duty by India, Nepal Rastra Bank had restricted banks from telegraphic transfer (TT) and draft for importing gold effective last week in a bid to control gold imports. Following the rise in customs duty by India, difference in gold price between two countries had widened by Rs 350 per 10 gram.
The government had imposed restriction on gold imports with the provision of bank guarantee or Letter of Credit worth 40 percent of total value of gold. Official data shows that gold amounting to Rs 34.5 billion was imported in the country in the last six months ending mid-January, 2010.
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