Gold hits record Rs110,000 per tolaPrices for the precious metal expected to rise above record $2,000 an ounce this year.
Gold prices continued to soar, reaching an all-time high of Rs110,000 per tola on Sunday in the domestic bullion market.
According to reports, in the international market, spot gold surged to $1,985.10 per ounce on Sunday.
The price is the highest since April 2022 due to the slide in dollar and stock making bullion more attractive for investment.
Gold's approach to the coveted $2,000 mark comes on the back of the collapses of Silicon Valley Bank and Signature Bank, which pushed investors to the perceived safer asset last week.
Gold prices are expected to rise towards record highs above $2,000 an ounce this year, albeit with a little turbulence, as the US slows the pace of rate hikes and eventually stops increasing them, according to the reports.
In Nepal, the gold price started to increase at the beginning of the year.
On January 24, the price of gold set a record Rs106,300 a tola (1 tola=11.66 grams) in the domestic bullion market.
The yellow metal was at Rs75,000 per tola before the Covid-19 pandemic started in Nepal.
“The price of gold increased due to the market uncertainty following a collapse of banks in the US,” said Manik Ratna Shakya, president of the Federation of Nepal Gold and Silver Dealers’ Association.
“The price in the international market is expected to increase given the current trend.”
The demand for gold in the domestic market, however, has slowed as prices are making new records in recent months, Shakya said.
“The precious yellow metal price has reached beyond the purchasing capacity of people amid the slowdown in the economy,” he said.
People purchase gold, especially on two occasions—marriage and when people have extra savings to spend on, he said.
In Nepal, gold jewellery is a traditionally and culturally essential accoutrement during wedding celebrations when women put on their best ornaments.
A middle-class Nepali family usually buys 5 to 6 tolas of gold when there's a wedding.
The people who were planning to buy with their savings now will hardly become able to buy it amid raising inflation, Shakya said.
With the chances of a rise in the prices in more coming days, there are chances that the number of people selling their gold will increase to get a good price and also to manage their financial needs, Shakya said.
According to the Department of Customs, Nepal imported gold worth Rs34.81 billion in the first seven months of the current fiscal year ended mid-February compared to Rs46.24 billion in the same period last fiscal year.
Nepal imported gold worth Rs63.19 billion in the last fiscal year 2021-22.