Gold hits record price of Rs 55,200 per tola
KATHMANDU, Nov 9:
Gold price increased by another Rs 5,00 per tola (11.664 grams) and hit a new high of Rs 55,200 in the domestic market on Wednesday.
Interestingly, Nepal Gold and Silver Dealers´ Association (Negosida) attributed the price rise to weakening of rupee vis-à-vis US dollar, something which made imports expensive.
“In Nepal, rupee on Wednesday weakened by around 45 paisa, but the loss was still higher when cross exchange difference was considered. This resulted in a net rise in prices of gold,” said Negosida President Tej Ratna Shakya. “Otherwise, gold in the international market dropped by $2 per troy ounce (31.103 grams).”
The association had opened the trading with the yellow metal priced at Rs 47,325 per 10 grams.
In the international market, gold stabilized at $1,790 per troy ounce after dropping $2 per troy ounce on the day. The prices settled mainly after Italian Prime Minister, whose stance against reforms mounted worries over Italy´s debt crisis, announced that he may step down.
Amid concerns of Italy taking the center stage of euro zone debt crisis, replacing Greece, gold price in the international market had soared by 2 percent on Tuesday. This had caused gold price to jump by Rs 1,000 per tola in the domestic market.
The rise in prices, meanwhile, lowered demand and sparked a selling pressure as Nepalis that invested their savings on gold in the past rushed to profit taking. However, most of the investors failed to reap the gains as dealers refused to buy back the yellow metal, referring to slump in demand.
“The demand for gold has presently dropped to around 15 kg a day, as this is neither a festive nor a wedding season,” said Shakya.
On the other hand, dealers said they witnessed a sudden rise in volume of supply. “Our estimate is that people floated around 20 kg of gold for sale. As this far exceeded the demand, we had to refuse purchases of excess supply,” said Shakya.
Even though country´s demand for gold remained pretty low this year, agencies reported that China is anticipated to consume around 400 tons of gold this year, far exceeding previous forecast of more than 350 tons.
