Gold trade poor on eve of Dashain festival, daily transaction stands at 15 kgs

By A Staff Reporter,Kathmandu, Oct. 14: Demand for gold has remained low even on the eve of Dashain festival this year.

Although Dashain is the main season to buy gold, the gold traders said that 15 kg of gold was hardly traded a day this time.

The demand for gold has dropped by 50 per cent during Dashain this year as compared to the same period last year, said Tej Ratna Shakya, a gold trader.

“In my six decades’ experience in the gold business, I have never seen this type of fall of gold business during this year’s Dashain,” he told The Rising Nepal.

The demand for gold used to increase a month before Dashain and reach above 40 kg a day in the peak week of Dashain.

It showed that the demand for gold has reduced by 50 per cent this Dashain than last year’s.  However, the daily transaction of gold, however, grew last week and reached around 15 kg a day.

According to him, daily transactions of gold will not reach 20 kg even in the coming days of Dashain this year.

“Local gold businessmen are greatly surprised by the drop in the demand for gold,” he said.

Only during the COVID-19 pandemic, the demand for gold had decreased to this level, he said, adding that the increase in the price of gold and weak economic activity could be the reasons for the fall in the demand for gold in the country.

Due to sluggish economic activities, the income of people has decreased, reducing the purchasing power of people and this has affected the gold business badly, he said.

“Normally, a large number of people used to buy gold from their savings after meeting all their other needs, including food and clothing. But the low income has made it difficult for consumers to even meet their daily requirements. In this situation, they are not interested in buying gold,” he said.

The demand for gold started declining in the country after the price of gold crossed Rs. 100,000 per tola. With the fluctuating gold price, a tola of gold has reached Rs. 110,100 at present. Earlier, the gold price increased to a record high at Rs. 113,600 per tola in the local market.

After the price of gold crossed Rs. 100,000 a tola in the market, the people are attracted towards the gold-plated jewellery available in the market, he said.

He said that almost a decade ago, people were not interested in buying gold-plated ornaments, but in the last few years, people’s attraction towards buying fake gold ornaments has increased.

He said that the flow of people in the shops selling gold-plated jewellery is higher than in the gold shops.