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| Kathmandu, Thursday January 23, 2003 Magh 09, 2059. |
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Gold price surges to all time
high
By Milan Mani Sharma
KATHMANDU, Jan 22 The price of gold went up to
an all time high in the Nepali bullion market with the price touching Rs 9,090 per 10
grams today. The rise in the price solely fueled by international factors, however, did
not stir the market, as the public rush for resale of old stock was far less than the
expectation of the gold dealers.
On Wednesday, the price of the yellow metal
increased by Rs 55 compared to Tuesday’s price of Rs 9,035 per 10 grams. The new
record price is higher by Rs 45 per 10 grams compared to the previous highest price of the
metal in the domestic market.
The previous highest price in the country was Rs
9,045 per 10 grams in February 1995. While increased international price and domestic
demand was the reason behind the 1995 price rise, this time it is the international market
alone.
Nepal Gold Silver Dealers Association (NGSDA),
which sets the market price of bullion in the country, considers domestic demand and
supply of gold along with the international demand and pricing while setting bullion
price.
"The overnight increment of the
international price, following the Bush administration convincing the market that war with
Iraq was almost inevitable, triggered the price rise in the domestic market," said
Tej Ratna Shakya, President of the NGSDA.
The latest price hike, however, was not
unexpected, as the domestic price of the metal had been rising since December 2002. In
December alone, the price had increased by Rs 445 to touch Rs 8,800 per 10 grams.
While the price went up to Rs 8,825 on January 4
and Rs 8,925 on January 7, it further went up to Rs 8,945 per 10 grams on Thursday, Rs
8,985 on Friday and Rs 9,035 on Sunday.
"As usual, the rise in domestic price was
subsequent to the increasing drift in the international price," said Shakya. He
stated that following the rise in prices, the consumption of gold has slid to 15 kg per
day - a decline of about 50 per cent compared to a normal daily consumption of 30 kg.
Even the much-expected increase in recycling of
old gold, given the price hike, was found wanting on Wednesday, informed capital-based
gold entrepreneurs. "The business today was as stagnated as any other day and there
were very few customers willing to resell their stock," they stated.
Even as few gold dealers informed of returning
the aspirant sellers asking them to come after a week, showing unwillingness to buy gold
from them at higher price in insecure market position, most of the customers are waiting
for the right time speculating of further rise in price, stated Shakya.
"With the chances of reverting the war
narrowing down, the price of gold is likely to soar further in both international and
domestic market," he added.
The international price of the precious metal
had gone up around 13 per cent since the start of December and almost 40 per cent up in
the past two years, according to reports.
In London, gold price opened at US$ 358.25 a
troy ounce on Wednesday, up from US$ 355.70 late Tuesday. On Monday, it was US$ 355.80,
while on Friday it surged to US$ 357.10 - US$ 4 higher than the previous week.
Concern over the threat of war in Iraq was the
main reason behind the sudden rise in prices. Also, fall in the value of dollar against
other leading currencies too fueled such rally.
On Tuesday, dollar slid against most key rivals,
hitting 39-month low against the Euro. A decline in the value of dollar against other
currencies makes gold more attractive to international investors because the metal is
priced in dollars in the world market.
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