Nepal gold price drops Rs 900 per tola as global market heads for monthly gain

Nepal market sees fresh decline

The Federation of Nepal Gold and Silver Dealers' Association reported that gold was trading at Rs 287,100 per tola on Wednesday, down from Rs 288,000 per tola on Tuesday. The Rs 900 per tola drop extended a downward trend that began earlier in the week. Silver also weakened, declining Rs 55 per tola to Rs 4,500 in the Nepali market.

Global spot gold on track for first monthly gain in five months

On July 31, spot gold slipped 0.6% to US$4,076.53 per ounce but was headed for a 0.6% weekly rise and a roughly 1.7% monthly gain, breaking a four-month losing streak. US gold futures for August delivery fell 0.4% to US$4,074.20. Tim Waterer, chief market analyst at KCM Trade, said the session reflected "a mild negative bias" driven by profit-taking and a moderate rebound in the US dollar, which gained about 0.3% after plunging 2.4% the prior session, its biggest single-day drop since January 2023. He added that the metal "has had a better run of things this month" with buyers attracted to dips around the US$4,000 level.

Fed policy and Middle East tensions weigh on outlook

The US Federal Reserve held interest rates unchanged at its Wednesday policy meeting, with Chair Kevin Warsh offering little guidance on the next move. Markets priced a 63% probability of a rate hike in September, according to CME Group's FedWatch tool, keeping attention on the opportunity cost of holding non-yielding gold. In the Middle East, a drone strike that ignited fires on two gas vessels at Egypt's Damietta Mediterranean port raised a new threat to shipping through the Suez Canal during the expanding US-Iran conflict. BCA Research analysts said longer-term geopolitical multipolarity and US fiscal imbalances would continue to support gold as a hedge against US assets.

Q2 jewellery demand falls as buyers opt for lighter pieces

The World Gold Council reported that gold jewellery demand fell 17% year on year in the second quarter of 2026 as high prices pushed consumers toward lighter products. First-half jewellery value, however, rose 22% to $86 billion as elevated prices offset reduced volumes. Total global gold demand was unchanged year on year at 1,269 tonnes in the quarter, while first-half demand rose 2% to an estimated 2,522 tonnes worth $380 billion. Combined investment in gold ETFs, bars and coins fell to 262 tonnes, with ETFs registering outflows of 45 tonnes during the quarter.

Central bank buying strengthens while recycling declines

Official institutions added a net 289 tonnes to reserves in the second quarter, a 62% year-on-year increase. Mine production rose an estimated 2% to 966 tonnes, supported by new output from Canada and Chile, offsetting a 6% decline in recycled supply as consumers held existing gold rather than selling back into the market. The World Gold Council expects investment to drive demand in the second half of the year, with OTC activity and Asian investment likely to take a larger role and Western ETF demand more closely tied to US monetary policy and dollar movements.

Next milestones

Attention now turns to the September US Federal Reserve meeting, where markets are pricing a rate hike, and to further developments in the Middle East shipping corridor following the Damietta incident.