Coronavirus Pandemic Hits Gold and Silver Trade

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Coronavirus Pandemic Hits Gold and Silver Trade

April 3: The lockdown to contain corona pandemic has hit the gold and silver trade in the country adversely. Gold and silver trade was already declining since the beginning of the current fiscal year due sharp hike in price because of the US-China trade war. However, the lockdown has completely ruined the gold and silver business, at least for the time being.

Some months ago, the trade war between China and the US and the tensions between Iran and the US, led to sharp rise in the price of gold in the international market.

Since the price of gold in Nepal is determined on the basis of the price in global market, the price of gold has been on the rise in the domestic market since last July.

The price of one tola (approx. 11 grams) of gold which was Rs 60,000 until the first week of July rose to Rs 82,500 by mid-July last year.  Currently, the price of 11 grams of gold in the domestic market is Rs 77,000. The trade of gold is declining due to rising price.

The businessmen involve in gold and silver trade are worried as coronavirus pandemic has brought their business to a grinding halt.

According to the Federation of Nepali Gold and Silver Dealers Association, there are 22,000 jewelry shops in Nepal which are currently closed. Most of these jewelry shops are operated in rented areas and the lockdown has led to loss of income of the traders and added cost burden.  

In such a situation, the gold and silver dealers are now worried about their expenses, mainly the rent and salaries of their staff members. 

Tej Ratna Shakya, former president of the Federation of Nepali Gold and Silver Dealers Association, informed that the biggest concern for all the gold and silver dealers is rent and salary of their staff. 

“At present, the whole nation is under lockdown and in such a situation traders and entrepreneurs involved in gold and silvers business won’t be able to pay the rents,” he said.

We are also worried about paying salary to the staff, he added.

 

 

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