Price of precious metals declines
Kathmandu, June 10
The precious metals witnessed currency play, with prices surging only for British investors, as the pound headed for the biggest drop in a year.
Bullion priced in sterling rose as much as 2.2 per cent to 1,007.52 pounds an ounce, a seven-week high, after Prime Minister Theresa May failed to win an overall majority. In dollar terms, the precious metal fell, as market attention for the rest of the world refocused on the prospect of US interest rates rising next week.
“The impact on the metal used as a hedge against political and economic uncertainties has been muted outside of the UK, even as May battles to survive amid calls for her resignation after a disastrous election that cost her party to lose its parliamentary majority just days before Brexit negotiations with the EU begin,” Bloomberg reported. Dollar rallied, while US equities gained and Treasury yields rose, hurting gold’s appeal as alternative investment.
Traders are pricing in a 95 per cent chance that the Federal Reserve may raise interest rates at its meeting next week, according to Fed fund futures data compiled by Bloomberg.
Some investors took advantage of higher prices for sterling-priced gold to sell positions, according to BullionVault, a London-based online trading platform.
In the domestic market, Federation of Nepal Gold and Silver Dealers’ Association (FeNeGoSiDA) had fixed gold price at 55,200 per tola and its price remained the same the next day. Bullion price went up by Rs 100 a tola to Rs 55,300 per tola on Tuesday and rose by another Rs 300 a tola to be traded at Rs 55,600 per tola on Wednesday. Thereafter, the appeal for the precious yellow metal dropped, with gold price down Rs 200 a tola to Rs 55,400 per tola on Thursday and slumping by another Rs 400 a tola to be traded at Rs 55,000 per tola on Friday.
Similarly, FeNeGoSiDA had set price of silver at Rs 775 a tola on Sunday and its price was unchanged next day. The price of white metal rose by five rupees per tola to Rs 780 a tola on Tuesday and remained constant the next day. Silver price fell by five rupees per tola each day over the next two days — to be traded at Rs 770 a tola on Thursday and Rs 770 per tola on Friday.