Local gold sales plunge 60 percent
Kathmandu, Nov 20 - Rising prices have sent gold sales plunging by 60 percent on the local market despite the ongoing wedding season. The price of yellow metal on Thursday set a historic high record of Rs. 27,650 per 10 gm (Rs. 32,250 per tola) after a continuous rise for four consecutive days.
Bullion traders said that only a few people were buying gold for wedding ornaments because prices had soared.
"We used to sell more than 25 kg of gold per day during the same period last year, but now it is below 10 kg," said Tej Ratna Shakya, president of the Nepal Gold and Silver Dealers Association (NEGOSIDA).
He said that demand for gold was very low due to the price hike as customers started to use their own old gold for making new jewellery, which is one of the prerequisites for weddings according to the local custom.
Suman Shakya, a gold and silver entrepreneur, said that this was the first time in his business history that demand for gold had gone down so drastically. "People come, ask the price, and return just like that," he added.
Similarly, former NEGOSIDA general secretary and an entrepreneur Rajendra Shakya said that he used to sell 90 to 120 gm per day during the wedding season, but now it was hard to sell even 20 gm per day. "Even those who need to buy gold have limited their purchase for the price increment," he said.
On Sunday, the yellow metal was selling for Rs. 27,050 per 10 gm (Rs. 31,550 per tola) whileit was traded at Rs. 27,100 (Rs. 31,600 per tola) on Monday,
Rs. 27,305 (Rs. 31,850 per tola) on Tuesday and Rs. 27,390
(Rs. 31,950 per tola) on Wednesday.
Similarly, gold has been setting records on the international market as well. From US$ 1,118 per ounce on Sunday, it surged to US$ 1,141 on Thursday.
"It had reached US$ 1,150 but slowed down to US$ 1,141 on Thursday," said president Shakya, adding that it was also a sign that the price may remain stable for a few days.
Gold was traded at US$ 1,129 on Monday and at US$ 1,136 on Tuesday and Wednesday.
According to entrepreneurs, the reasons behind the global hike in the price of gold are dollar devaluation, high speculation by investors and high demand on the international market amid fears of a scarcity after India purchased 200 tons of gold from the International Monetary Fund on Nov. 2, 2009 and EU and Asian central banks started to release dollars and collect gold from the market.
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