MONEY»
Cold gold war breaks out in the open
KATHMANDU, AUG 22 -
The emerging tussle and competition among gold traders’ bodies on Sunday pulled down the price of the precious yellow metal by Rs. 495 to Rs. 30,800 per ten gm compared to the Friday price. The price of gold on Friday was Rs. 31,295 per ten gm. Two gold traders, Nepal Gold and Silver Art Association (NEGOSAA) and Nepal Gem and Jewellery Association (NEGJA) fixed the gold price at Rs. 30,800 per ten gm on Sunday after Nepal
Gold and Silver Dealers’ Association (NEGOSIDA) protested the recent
move by the Nepal Rastra Bank (NRB) on sale of the bullion.
Gold traders associated with NEGOSIDA shut shop across the nation on Sunday and are also set to continue their protest until Monday. They will also submit a memorandum to NRB to restore the previous provision and increase the quota for gold import at least to 20 kg per day.
However, gold shops associated with two other gold traders’ associations remained open and conducted normal business, fixing the daily bullion price jointly. The associations have also formed a committee comprising representatives of both associations.
“The price is expected to decline further on Monday. We will set the price after necessary consultation with commercial banks involved in gold import,” said Dwarika Shankar, president of NEGOSAA. “Our committee can set the daily price in the coming days as NEGOSIDA does not have the monopoly.”
The price of silver has also gone down by Rs. 5 per ten gm. The joint committee had fixed silver price at Rs. 483 per ten gm compared to Rs. 488 on Friday.
Shankar said that they would continue fixing the daily bullion price based on the international market and the gold price paid to commercial banks supplying gold in the market as per NRB provisions.
Following NRB instructions, only commercial banks recommended by Nepal Bankers’ Association have been importing gold from the international market since the last three months. In recent days, the bankers are importing 10 kg of gold everyday even though the demand is around 20-25 kg per day.
On Friday, NRB issued a new circulation wherein commercial banks should sell 1 kg of gold to traders involved
in retail business only and not to wholesalers. The new instruction has also made it mandatory to supply 60 percent of daily release to Bagmati Zone and 40 percent to rest of the country.
“Bagmati is not the only market where gold traders are focusing,” said a senior NRB official. He added that all three gold traders’ associations have equal rights and must issue recommendations based on recent decisions taken by the central bank.
Under the new regulations, of the 10 kg gold released on a daily basis by banks, NEGOSIDA has the right to make recommendation for 50 percent and NEGOSAA and NEGJA can claim 25 percent each.
Posted on: 2010-08-23 08:05
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