Banks Halt Gold Imports As Demand Dries

SEATTLE (Scrap Monster): The banks in Nepal have stopped importing gold, as demand has almost dried up due Covid-19-related lockdown restrictions. The chances of resuming the gold imports look slim, as demand is not expected to show pickup unless lifting of lockdown restrictions.

According to Nepal Bankers’ Association, the banks in the country currently hold gold stocks of around 10 to 15 kilograms. The huge dip in gold imports may help the country to narrow its trade deficit, the association noted.

Nepal had imported gold worth Rs19.43 billion in the first nine month-period of the current fiscal. This is significantly higher by almost 43% when matched with the imports of gold which were worth Rs13.63 billion during the corresponding nine months last fiscal year. It must be noted that gold imports by the country were valued at Rs13.63 billion in the whole of the last fiscal year 2019-’20.

Earlier in April 2020, the country’s central bank had slashed the daily gold import quota from 20 kilograms to 10 kilograms. However, in response to rising demand, the bank had raised the import quota back to 20 kilograms per day, effective early-April this year. Incidentally, bullion traders in the country have been demanding to raise the limit to 30 kilograms.

The gold markets across the country are shut, on account of lockdowns imposed in almost all districts.

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