Yellow metal shines due to weaker US dollar

Yellow metal shines due to weaker US dollar

Yellow metal shines due to weaker US dollar

Weakening of the US dollar in the international market buoyed gold price, while that of silver fell in the trading week between October 7 and 12.

The week-on-week review revealed, however, that gold price went up by Rs 1,100 whereas that of silver was constant.

According to the Federation of Nepal Gold and Silver Dealers’ Association (FeNeGoSiDA), gold was traded at Rs 59,200 per tola on Sunday. On Monday and Tuesday, gold price fell by Rs 200 a tola to Rs 59,000 per tola and Rs 100 a tola to Rs 58,900 per tola, respectively.

On Wednesday, however, the price of yellow metal went up by Rs 100 a tola to Rs 59,000 per tola and jumped Rs 300 a tola to Rs 59,300 per tola on Thursday. On Friday, gold price surged by Rs 700 a tola to close the week at Rs 60,000 per tola.

Likewise, silver was traded at Rs 750 a tola on Sunday. Its price dropped by Rs 10 per tola to Rs 740 a tola on Monday and
remained stable over the next three days. The price of the grey metal rose by five rupees per tola to Rs 745 a tola on Friday.

As per the association, the price of precious metals is expected to rise further with the onset of the festive season and increase in demand.

Reuters reported that in the international market, gold prices eased on Friday, coming under pressure as the US dollar climbed and global stocks rebounded from a six-day rout.

“Gold remains down about more than 10 per cent from its April peak, pressured by a strong dollar as the US-China trade war unfolds while Federal Reserve has raised US interest rates.”

The US central bank hiked rates last month for the third time this year and is expected to raise them again in December.

In neighbouring India, physical gold demand was subdued during the week ‘as a rally in domestic prices curbed retail purchases going into a key festival season, while buying remained lacklustre in other major Asian hubs’.

“Jewellers want to make purchase for Diwali but they are waiting for a price correction,” one Mumbai dealer with a
private bullion-importing bank told Reuters.

Demand in India — the second top consumer of the yellow metal after China — usually strengthens toward the end of the year as the traditional wedding season kicks in and as the country celebrates major festivals, including Diwali and Dussehra, when buying gold is considered auspicious.

In China, markets opened after the Golden Week festival and premiums ranged between $4.50 and $8 an ounce.

-The Himalayan Times


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