Kathmandu, August 5
Gold price has again hit a new high in the domestic trading market today.
The price of the yellow metal surged by a staggering Rs 1,500 per tola overnight to be traded at Rs 67,800 a tola today. This is the third time that gold price has set a new record in the current month. This month, gold price had set a new record of Rs 65,800 per tola on August 2 before rising to a fresh alltime high of Rs 66,300 a tola on Sunday.
Earlier, gold price had peaked at Rs 65,500 per tola on July 19 — the same level it had first reached on June 25.
As the gold price continues to soar in the domestic market, daily sales of the precious yellow metal have declined.
According to Mohan Kumar Sunar, president of the Federation of Nepal Gold and Silver Dealers’ Association (FeNeGoSiDA), daily sales of the yellow metal in the market have declined by 75 per cent to 80 per cent due to the price hike. “Just a few days back, the market used to consume around 20 kg to 25 kg of gold. But now, hardly 10 kg of gold is being sold every day,” he said.
Moreover, the number of customers selling their gold jewellery has far surpassed those buying gold.
“Only those who really need to buy gold jewellery for some occasions are buying it otherwise most customers are visiting jewellery shops to sell their gold ornaments,” he said, adding that dealers are somehow managing to buy gold from customers.
As the demand for gold from bullion traders has come down significantly in recent weeks, the stock of raw gold with banks is increasing.
Hence, gold import has been halted since the first week of July. Amid this, Sunar said that the gold price is likely to go up some more in the coming days, which may affect the festive season sales too.
“With Teej and other festivals nearing, this used to be a prime season for sales of gold jewellery,” he said.
“However, as its price continues to rise every day, our business is likely to take a hit this festive season.”
He further said that the price of gold in the domestic market depends on its rate in the international market and the turmoil in the international arena has affected the price of the yellow metal.
Hence, it is difficult to predict whether gold price will come down by the time the festive season begins.
“Neither is it possible to predict about the gold price nor can we do anything about it,” he said, adding that gold traders are currently in a wait-and watch mode.
The ongoing trade war between the United States and China along with increased tariff by the US on Chinese goods have resulted in investors flocking to gold, which is considered a safe investment.
As per Reuters, gold prices jumped more than one per cent to their highest in more than six years today, as the escalating trade war between the US and China along with global growth worries drove investors towards safe-haven assets.
A version of this article appears in print on August 06, 2019 of The Himalayan Times.