Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: Nepal Rastra Bank (NRB) has significantly increased its investment in gold, acquiring the precious metal worth Rs 82.43 billion by the end of the fiscal year 2023/24. This marks a 25.3 percent rise in the central bank’s gold reserves compared to the previous fiscal year.
According to records from NRB, the central bank injected an additional Rs 16.61 billion to purchase gold during the last fiscal year. The increased market value of gold, coupled with NRB’s new acquisitions, has substantially bolstered the valuation of the bank’s gold reserves.
The price of gold in Nepal’s domestic market surged to an all-time high of Rs 153,100 per tola on Wednesday. This spike in gold prices has been a consistent trend, with new records being set almost daily. The NRB officials attribute the rise in the valuation of gold reserves to the soaring market price of the yellow metal, as well as the bank’s strategic investments.
This trend is not isolated to Nepal. International media reports suggest that central banks across the globe are also heavily investing in gold, reflecting a broader shift towards the precious metal as a secure asset amid global economic uncertainties.
In Nepal, the price of gold has seen a remarkable increase of Rs 40,000 per tola over the past year, according to the Federation of Nepal Gold and Silver Dealers’ Association. This significant price hike highlights the growing demand for gold, both locally and globally.
For the NRB, gold serves as a crucial part of its reserves, alongside silver, foreign currency, foreign securities, and foreign bills of exchange, which are all used to back the issuance of currency notes. The increase in gold reserves strengthens the central bank’s ability to manage the country’s monetary policy and reinforces its financial stability.
As gold continues to appreciate in value, NRB’s investment strategy in the precious metal positions it well to navigate potential economic challenges while maintaining the confidence of the market in Nepal’s monetary system.
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