Gold, silver prices up over 1pc
Kathmandu, November 11
The price of precious metals went up by more than one per cent in the trading week between November 5 to 10, underpinned by uncertainty over US tax reforms.
“Further political uncertainty in the United States saw gold prices well supported. News that the Republican tax plan involved cuts being delayed until 2019 raised the ire of investors,” ANZ said in a note.
US Senate Republicans unveiled a tax plan on Thursday that differed from the House of Representatives’ version on several key fronts, including how they treat the corporate tax rate, the tax deduction for state and local taxes, and the estate tax.
Gold is often used as an alternative investment during times of political and financial uncertainty.
The slower-than-expected pacing of interest rate hikes by the US Federal Reserve is supporting gold, Reuters quoted Mark To, head of research at Hong Kong’s Wing Fung Financial Group, as saying. The appointment of Jerome Powell as the new Fed chair has watered down expectations of a more hawkish stance from the central bank, he added.
“Overall though, the picture (for gold) is range-bound trading without much changes.”
Higher interest rates tend to boost the dollar, putting pressure on gold prices by increasing the opportunity cost of holding non-yielding bullion.
According to the Federation of Nepal Gold and Silver Dealers’ Association (FeNeGoSiDA), the increased industrial demand for the yellow metal for production of electronic goods may have supported price rise of gold.
FeNeGoSiDA had fixed the price of gold at Rs 55,300 per tola on Sunday and its price remained the same the next day. Bullion price rose for the remainder of the week. It went up by Rs 300 a tola each day for the next two days to be traded at Rs 55,600 per tola on Tuesday and Rs 55,900 a tola on Wednesday. Bullion price edged up by Rs 100 per tola for the next two days to be priced at Rs 56,000 a tola on Thursday and Rs 56,100 per tola on Friday.
Silver was relatively stable during the review period. The federation had set the rate of the grey metal at Rs 755 a tola on Sunday and its price remained the same the next day. On Tuesday, silver price went up by Rs 10 per tola to Rs 765 a tola and its price remained unchanged for rest of the week.