Precious metals lose lustre

Kathmandu, December 9

Price of precious metals — gold and silver — slumped in the local market during the trading week between December 3 and 8. Gold price fell by Rs 1,000 a tola over the course of the week, while silver price dropped by Rs 30 per tola.

Federation of Nepal Gold and Silver Dealers’ Association (FeNeGoSiDA) had fixed the price of gold at Rs 55,500 a tola on Sunday. Gold price fell by Rs 200 per tola to Rs 55,300 a tola on Monday. The price of yellow metal dropped by Rs 100 per tola to Rs 55,200 a tola on Tuesday.

Gold price fell by Rs 200 per tola to 55,000 a tola on Wednesday and remained unchanged on Thursday. On Thursday, however, bullion price slumped by Rs 500 per tola to close the week at Rs 54,400 a tola.

Similarly, price of silver also decreased in the trading week. FeNeGoSiDA had fixed silver price at Rs 740 a tola on Sunday, which fell by five rupees per tola to Rs 735 a tola on Monday. Price of silver remained southbound for next two days — down five rupees per tola each day to Rs 730 a tola on Tuesday and Rs 725 per tola on Wednesday.

Silver price was stable on Thursday, but on Friday, the grey metal slumped by Rs 15 per tola to close the week at Rs 710 a tola.

Reuters reported that gold prices hovered at four-month low on Friday and were on track for their biggest weekly fall since May after progress on US tax reforms fuelled optimism about the US economy and boosted the dollar.

Stronger-than-expected US employment data on Friday also demonstrated healthy economic growth and suggested Federal Reserve will raise interest rates next week.

The US Fed is expected next week to announce a rise in interest rates and offer guidance on the pace of further increases. It had previously forecast three rate hikes in 2018. That is likely to pressure gold prices because rising interest rates push up bond yields, reducing the appeal of non-yielding gold, and tend to boost the dollar.