Bullion traders fear sales slump in months ahead

KATHMANDU, May 17: Bullion traders let down by 25 percent drop in the sales of gold and silver over the past few months have expressed fears that the bullion trade may witness a sharp decline in the coming months.

According to traders, the period between mid-May to mid-July is regarded as off season by bullion traders as sales decline significantly during the period.

“As we didn´t witness boost in sales during the peak season, we are prepared for 35 percent decline in sales in the months ahead,” Mani Ratna Shakya, president of the Federation of Gold and Silver Dealers´ Association told Republica. “Fluctuations in the price of gold have led to drop in sales this year.”

According to Shakya, customers rarely visit jewelry outlets when the price of gold goes up, while they are unable to meet the demand when the price goes down.

Currently, the Nepal Rastra Bank (NRB) has been supplying 20 kg of gold to traders per day through commercial banks.

Shakya also said that the “rumors” spread about the quality and quantity of precious metals sold by bullion traders have also led to the decline in sales. “The authorities have constantly accused us of involvement in market anomalies. So customers are reluctant to visit jewelry stores,” said Shakya.

Echoing Shakya, Ramesh Maharjan, president of Nepal Gems and Jewelry Association said the government has to ensure smooth supply of gold during the peak season.
“Once there is a smooth supply of gold, we can make jewelries of new designs to attract customers,” Maharjan said.

Source: Republica