Gold surged by Rs 500 per tola in the domestic market on Sunday to break the record set last Friday.

The Federation of Nepal Gold and Silver Dealers’ Association has set the price of the precious yellow metal at Rs 156,800 per tola (11.66 grams) for the day.

Last Friday, it had spiked by Rs 3,000 per tola to be traded at Rs 156,300 per tola.

Traders attribute the recent price spike to growing speculations of US interest rate cut, besides the threat to global security from ongoing Russia-Ukraine war and Israel-Hamas conflict.

While the European Central Bank has reduced interest rates, the US Federal Reserve is also expected to cut rates by at least 25 basis points this week, according to international media reports.

Diyesh Ratna Shakya, senior vice-president of the association, told NBA that besides speculation on US rates cut, anticipation of BRICS nations introducing a common currency soon has further weakened the dollar, pushing the demand for gold.

“Countries like India, China and Russia have also increased their gold stock recently,” said Shakya, adding that gold prices in Nepal could touch the 180,000 per tola-mark in the coming months, if the global trend continues.

“It was estimated earlier that the gold price in the international market could reach $3,000 per ounce in five months,” Shakya added. “If that happens and current customs provisions remain, the gold price might surge to Rs 180,000 per tola.”

Customers are generally charged 7 to 10 percent more for gold jewelleries after including the goldsmith and other fees, according to Shakya.

Gold and dollar prices are inversely related to each other.

When gold prices started to gallop on a record breaking spree earlier this year, experts estimated the yellow metal could touch $3,000 per ounce.

In March, gold first broke an all time high record after reaching $2,160 per ounce. The record breaking spree continued in April and May. Though the price declined in June, it soared to a new high in July.

Gold was being traded at $2,579.7 per ounce in the international market on Sunday afternoon.

Meanwhile, silver also saw a rise in the domestic market, with its price increasing by Rs 40 per tola to reach Rs 1,900, compared to Rs 1,860 per tola on Friday.

The news has been updated