Himalayan News Service
KATHMANDU; Domestic market for gold this week closed at Rs 215 less compared to the opening price. According to the Nepal Gold and Silver Dealers’ Association (NEGOSIDA), gold this week closed at Rs 26,920 per 10 gram. “Though the price of gold is declining to
some extent, and the value of the dollar has been observed to reduce compared to the euro,” opined Tej Ratna Shakya, president of NEGOSIDA. Shakya said, “The dollar value was getting stronger but again it is declining.
Also, the price of crude oil which was $70 per barrel is now at $78 per barrel, which is also affecting the gold price in the international market. This in turn is causing a rise in gold trading price in the domestic market too.”
Gold this week opened at Rs 27,135 per 10 gram and hiked by Rs 85 on Monday to Rs 27,220 per 10 gram. A sharp fall in the gold trading price was observed on Tuesday with the price downing to Rs 26,880 per 10 gram. Yet another fall was observed on Wednesday, with the trading price falling to Rs 26,580. However, the domestic market for gold observed dual pricing on Thursday with opening price of Rs 26,705 per 10 gram and Rs 26,880 per 10 gram in the second half the same day. Gold this week closed at Rs 26,920 per 10 gram that is $1105.45 per ounce. However, gold traders opined that though the gold price seems to be declining this week, it has been observed rising in the second half of the week. This could be due to devaluation of the dollar compared to the euro.
The world price of gold, like the world price of oil, is expressed in US dollars. Therefore, when the value of the dollar declines the price of gold and oil increases. The price of gold also generally trends up when buyers and sellers of gold believe that the value of the dollar is likely to decline in the future. From the end of 2001 to January 2004 the dollar fell 30 per cent against the euro and 19 per cent against the yen. There is widespread belief among economists, investors, and others that over the next several years, with ups and downs, the dollar will continue its downward trend. Gold industry executives also expect the dollar to decline, and some mining companies are therefore withholding a portion of their production from the market, to sell at a later time, when they expect the price of
gold to be higher. Within limits, this tends to be a self-fulfilling prophecy; withholding gold drives the price up.
Meanwhile, silver opened at Rs 441.50 per 10 gram on Sunday and remained at the same price on Monday. With a fall of Rs 2.50 silver priced at Rs 439 per 10 gram on Tuesday. Silver on Wednesday priced at Rs 437 per 10 gram while on Thursday it got dual pricing the same day. Silver opened at Rs 437 per 10 gram that day and in the latter half of the day it was at Rs 439 per 10 gram. Silver closed at Rs 439 per 10 gram.
