KATHMANDU, Aug 3: Nepali rupee continued its freefall against US dollar this week as well, as the Indian currency with which rupee is pegged shed value due to Indian government´s decision to defer reforms, citing possible drought.
The drop in currency, meanwhile, caused the price of gold to decline nominally in the local market this week.
Nepali rupee shed 17 paisa against a US dollar over the week. This made imports costlier, but raised the income of remittance receivers as well as exporters. On Friday, a dollar was exchanged at Rs 89.13.
Nepal Rastra Bank (NRB), country´s monetary authority, had opened the trading Sunday with exchange rate of dollar set at Rs 88.96. Though rupee gained 12 paisa overnight on Monday, the announcement of the Indian government to defer reforms amid risk of drought eroded investors´ confidence there, causing rupee to shed 11 paisa on Tuesday and further 15 paisa on Wednesday. Rupee again shed 4 paisa on Thursday, but regained a paisa on Friday when the market closed this week.
Likewise, rupee shed 16 paisa against a euro, but gained 97 paisa against a pound sterling over the week. A euro was exchanged at Rs 109.47, while a pound sterling was valued Rs 138.55 on Friday.
Gold became cheaper by Rs 85 per 10 grams in the domestic market this week, as its international demand slid after the European Central Bank refrained from announcing any aid to contain the euro zone´s crisis. On Friday, gold was traded at Rs 48,870 per 10 grams in the domestic market.
Bullion trading had opened this week with gold priced at Rs 48,955 per 10 grams on Sunday. While the price remained unchanged on Monday, gold price inched up by Rs 85 per 10 grams on Tuesday due to weakening of rupee. But the price dipped back by same margin on Wednesday as international demand fell amid continuation of troubles in the euro zone economy.
Nepal Gold and Silver Dealers Association (Negosida) did not effect any change on price on Thursday and Friday as the market remained closed due to Janai Poornima and Gai Jatra festivals.
The price of silver also dropped by Rs 4.50 per 10 grams over the week. Silver was traded at Rs 874.50 per ten grams on Friday.