The price of gold dropped by Rs 2,400 per tola (11.66 grams) in the domestic market of Nepal on Tuesday, November 12.
According to the Federation of Nepal Gold and Silver Dealers' Association (Fenegosida), fine gold is being traded at Rs 162,600 per tola, compared to Rs 165,000 the previous day.
Earlier on October 31, gold price peaked in the domestic market at Rs 171,000 per tola. The record was set when preparations were in full swing for Tihar celebrations.
However, the precious yellow metal became cheaper by Rs 2,800 per tola last Tuesday, November 5—when the Fenegosida set the new trading rate after Tihar holidays. Despite a slight increase of Rs 300 per tola the following day, gold saw a major decline of Rs 4,000 per tola on Thursday, which the industry insiders attributed to the strengthening US dollar following Donald Trump's US election victory.
The fluctuation continued, with the resurgence of price by Rs 2,000 per tola on Friday following the US Federal Reserve cutting its key interest rate by 25 basis points.
The bullion prices have fallen for three consecutive days this week, by Rs 600 on Sunday and Rs 1,000 on Monday.
Silver price also dipped by Rs 30 on Tuesday to Rs 1,925 per tola.
The domestic market follows the international trend.
“Gold fell on Tuesday to its lowest in nearly two months, weighed down by a stronger dollar, while investors awaited a set of key US economic data and comments from Federal Reserve officials for further clarity on the interest rate trajectory,” reported Reuters . “Spot gold fell 0.9 percent to $2,597.91 per ounce by 0747 GMT, hitting its lowest since September 20. US gold futures fell 0.5 percent to $2,604.30.”
The bullion prices have broken records amid global uncertainties, such as intensifying conflict in the Middle East, Russia-Ukraine war and interest rates cut by central banks in several countries, this year.
In the international market, an ounce of gold became dearer by 41 percent in 12 months, with its price rising from nearly $1,950 to $2,750.
These events have driven investors toward the bullion as a safe haven, making it dearer than the dollar, they say.
The surge in prices followed widespread speculation that the yellow metal would cross $3,000 per ounce-mark in the near future.
Diyesh Ratna Shakya, senior vice-president at Fenegosida, had told NBA in September that if the international trend would continue, the price in the domestic market could cross Rs 180,000 per tola-mark, costing the gold jewelleries nearly Rs 200,000 per tola after the addition of the goldsmith and other fees.
However, the dollar is expected to become stronger with Trump, who has pledged to improve the US economy, set to return to the White House.
Gold and dollar prices are inversely related to each other.
While the dollar has surged since Trump’s victory, bitcoin has also begun a record breaking rally.
Trump was seen as the pro-crypto candidate in his battle with the Democratic Party's candidate Kamala Harris, according to AFP .
If Trump would deliver on his economic agendas and succeed in resolving the conflict in the middle-east and between Russia-Ukraine, the gold’s record breaking rally could come to an end, industry insiders have said.
Meanwhile, Nepal Rastra Bank fixed the exchange rate (selling rate) of $1 at Rs 135.34 for Tuesday, compared to 135.31 the previous day.
