Gold, Silver Extend Rally to Fresh Highs in Domestic Market

Gold and silver prices surged to fresh records in Nepal’s domestic market on Monday, December 22. Gold jumped by Rs 3,400 per tola in a single day.

According to the Federation of Nepal Gold and Silver Dealers’ Associations (FENEGOSIDA), hallmark gold was priced at Rs 261,700 per tola (11.66 grams) on Monday, up from Rs 258,300 per tola on Sunday.

The precious yellow metal previously reached a new high last Monday at Rs 260,700 per tola.

Silver also extended its rally for a second straight day – up by Rs 130 per tola to Rs 4,235 from Rs 4,105 per tola.

The sharp rise reflects record-breaking prices in international bullion markets. Spot gold rebounded to $4,397 per ounce early Monday after briefly crossing the $4,400 mark earlier in the day. Spot silver climbed to $69.37 per ounce.

Market watchers attribute the surge to expectations of further US interest rate cuts despite a senior US Federal Reserve official saying last Friday there was no urgency to cut rates further.

Gold has already broken multiple milestones this year. The precious metal surged past the $3,000 and $4,000 per ounce marks.

“The recent US interest rate cut of 0.25 percentage points and the expectations for further reduction is the immediate trigger for the rise,” said Diyesh Ratna Shakya, senior vice president at FENEGOSIDA. He added that a weaker US dollar and a slowing US economy have pushed investors towards gold as a safe haven.

Traders also point to geopolitical risks. These include the Russia–Ukraine war and tensions in the Middle East. Shakya added the latest strain between China and Japan has further supported bullion prices.

If the trend persists, gold could cross Rs 300,000 per tola, traders say. Silver may approach Rs 5,000 per tola within the next three months.

“That said, prices could go either way, there are risks of both sudden gains and breakdowns. For now, the likelihood of further gains appears stronger,” Shakya said.

Rising prices have begun to weigh on consumer demand.

“Though last month [Mangsir] was the wedding season, and the coming month is another peak period, jewellery orders are not that encouraging,” Shakya added.

Observers have also urged caution. “Investment in both gold and silver remains relatively safer for the long run, but the lure of immediate profits can disappoint investors,” Shakya said.