KATHMANDU, Dec 21: Nepali rupee weakened against US dollar for the second straight week as heavy dollar buying by oil firms and gold importers in India hurt Indian currency - with which rupee is pegged - this week.
Despite rupee´s fall, gold continued its downward spiral and hit a four-month low of Rs 58,320 per tola over the week as global investors´ wariness over weakening of euro against dollar and stalling of talks to avoid looming fiscal crisis in the US dragged its price down in the international bullion market.
Nepali rupee shed 69 paisa against a US dollar over the week, causing import cost to go up but also raising receipts of exporters as well as remittance receivers. On Friday, a US dollar was exchanged at Rs 87.90.
Currency trading had opened this week with exchange rate of US dollar set at Rs 87.21 on Sunday. But as gold importers and oil companies in India placed huge demand for the greenback, Indian currency fell, causing rupee to shed 24 paisa on Monday and another 40 paisa on Tuesday. Rupee further fell by 30 paisa against US dollar on Wednesday. Rupee, however, gained 55 paisa against a dollar on Thursday after dollar sale by Indian power firms enabled Indian currency to gain values. However, rupee again shed 30 paisa on Friday, as Indian currency slipped on the back of growing oil demand.
Likewise, rupee shed Rs 1.95 against a euro and fell by Rs 2.28 against a pound sterling over the week. Euro closed at Rs 116.26 on Friday, while a pound sterling was exchanged at Rs 142.98 when the market closed this week.
Gold hit a four-month low over the week as its price fell by Rs 755 per 10 grams (that is Rs 881 per tola) amid drop in its international price. The yellow metal was traded at Rs 50,000 per 10 grams (that is Rs 58,320 per tola) on Friday.
Bullion trading had opened this week with gold priced at Rs 50,755 per 10 grams (that is 59,201 per tola) on Sunday. Though the price remained unchanged on Monday, and went up by Rs 255 on Tuesday amid resumption of talks to end the US fiscal crisis, the yellow metal fell by whopping Rs 600 per 10 grams on Wednesday. Gold again dropped by Rs 85 per 10 grams on Thursday and further by Rs 325 per 10 grams when the market closed this week on Friday.
The price of silver also recorded a sharp drop of Rs 56 per 10 grams over the week. On Friday, silver was traded at Rs 943 per 10 grams, according to Nepal Gold and Silver Dealers Association.