Gold price soars to record high of Rs 75,500 per tola

Increasing by Rs 1,000 overnight, gold price has set a new record of Rs 75,500 per tola (11.664 gram) in the domestic market today.
According to the Federation of Nepal Gold and Silver Dealers’ Association (Fenegosida) confirmed that the precious yellow is traded at Rs 75,500 per tola today, from yesterday’s Rs 74,500 per tola.
Gold price has been breaking its own record every day due to tensions amid middle east after Iran’s top military commander was killed in an airstrike. The price went up for the third time this week between December 29 and January 4, the association informed, adding that the gold price was fixed at Rs 73,300 per tola on Sunday and remained constant on Monday. “But on Tuesday, gold price went up by Rs 200 a tola to be traded at Rs 73,500, and remained constant till Thursday,” it said, adding that however, on Friday gold price rose sharply by Rs 1,000 per tola to close the trading week at Rs 74,500 per tola.
The Iran-US conflict led investors to invest in gold – which is considered a safe haven investment –pushing up the price of gold in the international market. The increase of the gold price in the international market subsequently pushes the domestic market price too, apart from the rising US dollar against Nepali rupee that also pushed gold price up in Nepal.
Last June, gold was traded at Rs 59,500 per tola following a jump in prices due to trade tensions between the US and China and also a hike in Nepali import duty by Rs 800 per 10 gm. The customs duty was again raised by Rs1,500 per 10 gm in November.

Foreign exchange limit for outbound Nepalis lowered to $1,500

The foreign currency exchange facility for a Nepali going for a foreign trip – except India – has been reduced to $1,500 from earlier limit of $2,500. The central bank has – issuing a directive today – reduced the maximum amount of foreign currency facility for a Nepali going abroad.
The commercial and development banks, authorised to sell foreign currency, can now sell only $1,500 per passport for a Nepali national going abroad, according to the central bank that has restricted the purchase of foreign currency due to foreign currency flight, and also depleting forex reserve. "The rising foreign currency flight is putting pressure on the foreign exchange reserves."
The rising income, in recent years, has fuelled the outbound travel – especially during long holidays – of Nepalis putting pressure on hard earned foreign currency that mostly comes in as remittance from the Nepali migrant workers.
The central bank has introduced the new rule to discourage the growing outflow of foreign currency on account of outbound tourism, according to the Forex Department of the central bank. In the last fiscal year of 2017-18, Nepalis spent Rs 79.6 billion in travel, some 40 per cent up from the amount two fiscal years ago, the department states. The country, however, earned Rs 177.47 billion in the fiscal year 2017-18 from foreign travellers coming to Nepal.
Likewise, the central bank has also reduced the limit on payments through Telegraphic Transfer (TT) to $30,000 from the earlier limit of $40,000.
The central bank has also raised the limit on loans for commercial banks from foreign banks to 50 per cent of core capital, up from 25 per cent to facilitate foreign currency borrowing by commercial banks. "The limit is being increased to facilitate the banks as they have not found possible lenders abroad due to low amount of borrowings," the central bank claimed.
The stronger dollar, in recent weeks, has also increased pressure on foreign exchange reserves. The US dollar has gone up nearly by 15 per cent from the beginning of the current fiscal year. A dollar costs Rs 117.3 today, up from Rs 102.5 on January 1.
According to the central bank, gross foreign exchange reserves has depleted to $9.75 billion as of mid-September 2018 from $10.08 billion as of mid-July 2018 also due weak Nepali rupee.

Gold price drops by Rs 2,100 to Rs 53,502 per tola in a week

Wedding bell might be more soothing for those who are planning to marry as the gold price has started looking down in the marriage season.

The precious yellow metal price dropped by Rs 2,100 per tola (11.664 gram) in a week today to Rs 53,502.76 per tola or Rs 45,870 per 10 gram in the domestic market from last Wednesday's Rs 55,602.28.

The drop in the price and also due to marriage season, the gold import that has seen a drop, however, might increase.

According to the central bank, gold import has dropped to almost by half Rs 3.56 billion in the first three months of the current fiscal year 2013-014 compared to Rs 7.06 billion in the same period of the last fiscal year. "The gold import stood at Rs 5.39 billion a fiscal year ago in 2011-12."

The traders however, claimed that gold import dropped due to heavy price hike in the international market. The precious yellow metal is priced in the domestic market on the basis of international market price. "The gold price in the international market in US dollar is converted to Nepali currency adding a little margin," according to the traders. "Though, gold price and US dollar relation is negative in the international market, it is however, positive in the domestic market," they said, adding that the price in the gold price in domestic market rises in both cases.

Gold is hovering around $1,250 per ounce in international market.

US dollar gains, pushes gold price up too

The Nepali rupee today dropped to less than Rs 100 against the greenback.

Though the central bank has fixed Rs 99.72 as the reference selling rate for one US dollar for today, the banks sold a US dollar at above Rs 100 as they have been allowed to fix their own rate. 

The central bank has fixed Rs 100.32 as the reference selling rate for a US dollar for tomorrow.

The US dollar – due to weak Indian currency with which Nepali currency is pegged – has been below Rs 100 after October 3.

The Indian rupee hit its low of Rs 62.58 today the lowest since October 2 on sluggish domestic equities and demand from private oil companies – according to news agencies – pulling the Nepali rupee along with it.

Likewise, the precious yellow metal has also gained Rs 200 per tola – 11.664 gram – in the domestic market and being traded at Rs 56, 200 per tola due to string US dollar.

Rupee hits historic low of 108.90 per dollar, will it cross 115 ?

The Nepali rupee plunged to an all time low of Rs 108.90 against the US dollar today after the Indian rupee sank to the record low of Rs 68.75.
The central bank today morning revised the foreign currency exchange reference rate for selling at Rs 108.90 vis-à-vis US dollar in the morning for today’s trading, making a US dollar Rs 10 expensive in a month.
Earlier yesterday evening, the central bank had fixed the reference selling rate of the US Dollar at Rs 105.35 for today.

The central bank fixed the reference exchange rate twice today – most probably for the first time – once in the morning for today and another in the evening for tomorrow.

The exchange rate of the morning at Rs 108.90 has been revised to Rs 108.60 in the evening for tomorrow, after the Indian currency made some gain in the evening. Experts claim that the Nepali rupee is going to slip as low as Rs 115 against a US dollar as there is less chances of Indian rupee – against which Nepali rupee is pegged – to gain.

Despite several measures by the Indian government and Reserve Bank of India (RBI), there is a less chance of the Indian rupee strengthening heavily in the context of the election year – that is 2014 – in India when major policy decisions for reforms are unlikely to be taken. “Foreign investors have little confidence on Indian economy and they are unlikely to return any time soon, gold imports likely to go up and deficit usually go up in the election year,” according to the reports.

But the remittance-based economy can neither benefit nor lose from the current currency volatility as the increased remittance in flow will also be eaten by the increased price of the imported goods, though the poors will suffer due to rising inflation that could not be checked by either central bank or the government.

 The Nepali rupee depreciation against the greenback could be beneficial had Nepal been able to export over Rs 100 billion, but the country’s export basket is too small to take benefit from the rising US dollar. The country had exported Rs 76.92 billion worth merchandise in the last fiscal year, whereas the imports stood at Rs 556.74 billion.

Though, the importers have cut down imports by two-thirds and are still waiting for the Nepali rupee to stabilise, the import bill of the petroleum products – that is the single largest commodity import – will anyway increase hitting the market price that is already going up due to weak rupee.

The poors are going to suffer anyway as all the other currencies against Nepali rupee have been gaining pushing the Nepali rupee to its lowest ever that is going to increase poverty incident in the current fiscal year in the country.

Nepali rupee at historic low against dollar

The Nepali rupee has reached a historic low at Rs 93.19 for a US dollar as the Indian currency (INR) was not able to put any brakes on its free fall.

The reference rate determined by Nepal Rastra Bank (NRB) stands at Rs 93.19 as referential buying rate for tomorrow based on today's forex trading.
Likewise, NRB has fixed the selling rate for the dollar at Rs 93.73 for tomorrow. The dollar exchange rate had never risen above Rs 92 before. Yesterday, the rate was fixed at Rs 92.33 — another historic low for the domestic currency.

The Indian rupee (INR) — with which the Nepali currency (NPR) is pegged to — dropped to INR 58.98 — a record low — making the Nepali rupee dive along. INR is weakening along with major currencies worldwide including the euro, yen and Australian dollar, among others, as the dollar has become more attractive recently. Despite, the spotty US economic data, a decline in jobless claims along with better consumer confidence index is making the dollar stronger.

A strong dollar is desirable for exporters as their exports will fetch higher amount while imports will become expensive in the domestic market.

Rupee further weakens against dollar

The Indian currency's free fall against the US dollar once again dragged down the Nepali currency to a new low today.
The exchange rate of the Nepali currency vis-a-vis the US dollar crossed Rs 91 for a dollar today on average as Nepal Rastra Bank determined Rs 91.28 for the exchange rate as buying rate for tomorrow based on today's forex trading.
The Indian Currency (IRs) with which Nepal's currency is pegged to has been taking a continuous beating against the US dollar and reached as low as IRs 57.30 in the forex market. Nepali rupee also went along with the slide due to the peg.
The US dollar's gains against the euro and other major currencies in forex markets amid global economic troubles along with Moody's downgrading of the world's 15 biggest banks has aided in the depreciation of the Indian rupee.
Likewise, strong demand for dollar from oil importers and increased capital outflows from India further dampened the Indian rupee. To halt the free fall, Reserve Bank of India has directed state-owned oil firms to buy half of their dollar requirements for oil imports from a single public sector bank.
Though a weak currency is generally bad news for any country, Nepal's foreign currency reserve has swollen thanks to the recent depreciation run.
In the 10th month of the current fiscal year, Nepal's surplus in its balance of payments crossed Rs 100 billion mostly due to increased remittance inflow by 36.5 per cent to Rs 282 billion on the weak Nepali rupee.