KATHMANDU: Gold sales have started swelling at major gold shops in the country with the market returning to normality. Most of the shops that were closed after the earthquake have reopened and they are starting to see an increased number of customers.
According to Federation of Nepal Gold and Silver Dealers’ Association (Fenegosida), around 90 percent of the gold shops in the country have reopened. New Road, Pyukha, Wotu, Chabahil and Mangal Bazaar are the major gold hubs in the Kathmandu valley.
“Gold shops are seeing a rise in footfall as life is gradually returning to normal,” said Mani Ratna Shakya, president of Fenegosida. “Around 10 kg of gold is sold daily nowadays against 3-4 kg till last week.” Shakya said that although they were seeing a rise in demand, they were having difficulties getting stock as banks had hiked their rates since the earthquake.
Nepal Rastra Bank has felt that there has been a slowdown in gold smuggling due to low demand in the market following the quake as well as the sterner measures the government had taken against smugglers. As a result, traders seem to be sourcing gold from banks.
“As per the understanding reached between banks and Fenegosida, banks have too provide gold to traders with a Rs250 markup, but banks have been charging Rs50-60 extra,” said Shakya. He accused banks of overcharging as they had to hold on to stocks for a longer period due to the slow demand after the earthquake.
Meanwhile, traders said that sales had also been hampered due to lack of goldsmiths who fled to their homes after the earthquake. “Around 75 percent of the goldsmiths are from India and they have not returned to work, so we are having a hard time making jewellery for our customers,” said Tej Ratna Shakya, former president of Fenegosida and proprietor of Tejmin Jewellery at Pyukha, New Road.
“Gold prices have been fluctuating for a month and demand for gold jewellery has increased sharply since last week, but we lack qualified goldsmiths.”
Gold prices have been going downhill since mid-May when a few shops reopened after the earthquake on April 25. Traders said that prices had been decreasing in line with international trends. The price of gold in the domestic market decreased Rs1,400 per tola over the last one month.
On Tuesday, the yellow metal traded at Rs51,600, down from Rs53,000 on May 15. Similarly, silver prices dropped Rs35 per tola over the period. Silver traded at Rs705 per tola, down from Rs735 per tola on May 15.