The yellow metal shed more than $55 per troy ounce in the international bullion market on the day, as the European Union convenes a summit on deepening debt crisis in the euro zone.[break]
“Price of gold has dropped in the domestic market as major markets are keenly waiting the outcomes of the summit. As our market is totally dependent on imports, any change in prices in the international market is directly reflected here,” said Manik Ratna Shakya, general secretary of Nepal Gold and Silver Dealers Association (Negosida).
Gold trading began in international bullion market at $1,712 per troy ounce on the day. But the price soon dropped to $1,660 per troy ounce.
Rapid fluctuation in gold prices, meanwhile, has affected the sales of gold in the domestic market during the peak wedding season.
Gold has become expensive by more than Rs 15,000 per tola, directly affecting sales in the market. The yellow metal was traded at around Rs 40,000 per tola during the peak wedding season last year.
“Rising prices is forcing consumers to keep their gold buying on hold. Though daily sales have increased a bit as compared to normal daily demand, it is nowhere near sales volume of last year,” Shakya added.
According to traders, gold sales have dropped by almost 60 percent this year. Daily sales of gold at present hovers around 22-25 kg, down from average daily sales of 45 kg recorded during last year´s wedding season.
“Sales volume in this peak season has dropped to the level recorded during lean season of last year,” he added.
Gold´s bear run in the domestic market in recent months is forcing consumers to go for recycled jewelries, according to traders.
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