Gold hits record Rs 37,850
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KATHMANDU, JUL 19 -
Gold has hit historical highs following the euro zone debt crisis in the international market. The yellow metal traded at a record Rs 37,850 per 10 gm (Rs 44,148 per tola) in the domestic market on Monday. Gold touched US$ 1,596.65 an ounce in the international market on Monday amid continued concerns over the debt crisis.
Meanwhile, silver increased to US$ 40 an ounce in the global market pushing up the price to Rs 947.50 per 10 gm (Rs 1,105.16 per tola) in the local market.
“If this trend continues, the day is not far when gold will go over Rs 45,000 per tola,” said Tej Ratna Shakya, president of the Nepal Gold and Silver Dealers Association (NEGOSIDA). He added that international market analysts had projected that gold would reach as high as US$ 1,600 an ounce very soon.
On Sunday, the first day of the new fiscal year, the price of gold increased to a new record of Rs 37,650 per 10 gm. Similarly, silver jumped Rs 18 per
10 gm to Rs 943. Silver was recorded at Rs 925 per 10 gm on Friday in the domestic market.
The rise in the price of gold has slowed down demand in the local market from the normal daily consumption of 30 kg to 15 kg. According to NEGOSIDA, the trend of recycling old gold jewellery has affected bullion sales.
Shakya said that though demand for gold had declined because of rising prices and preference for recycling, there was good scope in the export of gold jewellery. “We had asked the government to come up with a provision to increase the import of gold by implementing the open general license (OGL) system, however, the new budget has completely disheartened us as there was not a word about it,” he added.
Nepali traders have been exporting gold jewellery worth an estimated Rs 100 million annually. NEGOSIDA has also been lobbying with its international counterparts and the Ministry of Commerce and Supplies to boost jewellery exports.
Gold dealers said that they were hopeful that the government would implement OGL through the upcoming monetary policy.
They added that implementation of OGL would allow traders to import gold in a competitive way which would ultimately help in easing the supply system besides boosting exports.
Currently, only designated commercial banks obtaining recommendation from the Nepal Bankers Association are allowed to import 15 kg of gold each daily. “Gold imported by the banks is being consumed in the Kathmandu Valley and Pokhara, while the requirement in other parts of the country is being fulfilled by gold smuggled in from India,” said Shakya.
Posted on: 2011-07-19 11:26
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