Gold slips as festival euphoria wears off

KATHMANDU, OCT 29 -

Gold slipped Rs 400 per tola on Tuesday due to a drop in the international market and slowed domestic demand after the end of the festival season. The yellow metal traded at Rs 51,600 per tola on Tuesday.

Gold has lost Rs 1,100 per tola since the Tihar festival. It was trading at Rs 52,700 per tola before the markets closed for the celebrations. Similarly, silver prices declined by Rs 10 to Rs 720 per tola.

“Gold prices are falling in the international market as investors are turning to shares due to a slight recovery,” said Mani Ratna Shakya, president of the Federation of Nepal Gold and Silver Dealers’ Associations (Fenegosida). Global media reported that gold prices in Singapore dipped 0.3 percent to $1,227.51 per ounce.

Shakya added that a fall in demand from jewellers and retailers with the end of Tihar also contributed to the drop in prices.

Traders have reported healthy sales during the festival season. According to Fenegosida, 60 kg of gold and 400 kg of silver were sold during the first three days. The city’s daily requirement of gold hovers around 20 kg during normal times.

“During the day of Dhanteras which is considered to be an auspicious day to buy precious metal, most of the traders witnessed a robust growth in sales,” said Tej Ratna Shakya, a special member of Fenegosida.

Nepal Rastra Bank allows commercial banks to import 15 kg of gold daily. Traders said that they get additional supplies from other sources like air travellers and customers recycling old jewellery during times when gold demand surges.

Gold has been on a downward trend this year. Compared to the same period last year, prices are down 9.31 percent. According to Fenegosida, gold was traded at Rs 56,900 per tola on October 28, 2013.

Similarly, silver prices have declined 24.21 percent over the year. Silver was traded at Rs 950 per tola during the same period last year.

Source: The Kathmandu Post