Rs 29 billion gold imported in 10 months of FY2018/19
KATHMANDU, Aug 5: Gold marched to a record high of Rs 66,300 per tola (11.664 grams) in the domestic market on Sunday.
The yellow metal was traded at Rs 65,800 per on Saturday. According to the Federation of Nepal Gold and Silver Dealers’ Association, gold price had increased by Rs 800 per tola on Saturday compared to Friday. The federation, which sets the reference price for gold dealers in Nepal, had also raised the price on Thursday morning in line with the international price movement.
Similarly, the price of worked gold, which was traded for Rs 64,700 on Friday and Rs 65,500 on Saturday, further increased to Rs 66,000 on Sunday. Before Sunday’s price hike, gold had traded in the band of Rs 64,300-Rs 65,800 per tola since July 10.
Date compiled by the federation shows the price had climbed up by Rs 200 on Monday before shedding Rs 400 per tola two days later.
Gold dealers have attributed the surge in gold prices in the domestic market to glittering of gold in the global market due to escalating trade war between the US and China.
“Though they sat for talks, the discussion was concluded without any deals,” Tej Ratna Shakya, a former president of the federation, told Republica. “US President Donald Trump’s statement to impose 10% tariffs on another $300 billion worth of Chinese goods starting September 1 has caused further fluctuation in the gold price,” he added.
Global investors are attracted toward bullion which is considered a safe haven for investment when interest rates and dollar are on a downward trend, making the precious yellow metal dearer.
Shakya also said that the decision of the Federal Reserve Bank, the US central bank, to cut interest rate by 0.25% on Wednesday impacted the global gold market. “Global stocks are on a downward trend, the Indian Currency (IC) is also weakening compared to the US currency.
As the Nepali market is pegged with the Indian currency, weakening Indian bills also affects Nepal’s gold market,” he added.
According to the federation, the daily demand for gold in the domestic market stands at around 35 kilograms on a normal day. “The demand has declined by 75% days. Instead of buyers, we are getting customers looking to sell their jewelries,” he added.
Designated commercial banks can sell a maximum of 20 kilograms of gold to dealers in a day. Commercial banks imported Rs 29.04 billion gold in the first 10 months of FY2018/19.
In FY2017/18, commercial banks had imported gold worth Rs 32.2 billion. Such imports were worth Rs 27.43 billion in FY2016/17, according to the central bank.