Gold at two-year low at Rs 48,000 per tola

KATHMANDU, July 22:

Gold price dropped to a two-year low of Rs 48,000 per tola (11.664) grams in the domestic market on Wednesday.

Price of the yellow metal fell by Rs 1,500 per tola on the day compared to Tuesday.

Jewelers say gold price has dropped in the domestic market due to reduction in customs duty on gold imports and falling price of gold in international bullion market. Gold was traded at US$ 1,094.8 per troy ounce in the international market on Wednesday compared to Tuesday's rate of $1,134.30 per troy ounce.

The government slashed import tax on gold by Rs 100,000 per kg to Rs 320,000 through the budget for Fiscal Year 2015/16.

"Gold price is falling in the international market due to strong dollar and declining price of crude oil," Mani Ratna Shakya, president of Federation of Nepal Gold and Silver Dealers Association told Republica. "Because of this, investors are offloading their gold stock and investing on other instruments. This is making gold cheaper."

Shakya said gold price fell by a big margin in the domestic market because of the decision to reduce import tax on gold. "The government finally reduced import tax on gold as per our request. We are hopeful that it will discourage illegal import of gold," he added.

Meanwhile, dealers are hopeful that drop in price will revive their business which saw a slump after the earthquake of April 25.

Source: Republica