As the gold price is fast to spike yet slow to fall in the domestic market, the sellers exceed the buyers, traders said.
“When the global gold prices jumped in recent days, domestic gold price was fetched K1,278,000 per tical (0.578 ounces, or 0.016 kilograms) in the fourth week of July. The market sees sellers outnumber buyers, according to the Yangon Gold Entrepreneurs Association (YGEA).
“Some people purchase gold at around K1.2 million per tical and they sell it when the price is up to around K1.299 million per tical on 22 July. This means buying low and selling high. When there is an increase in the number of sellers, the price slips. When the sellers surpass buyers, the gold price cannot remain high above K1.3 million per tical. The domestic gold price does not rise at the same rate despite the global hike. It is K85,000-90,000 lower than the global rate. The price is not likely to keep lower than the prevailing rate in the mid-monsoon season. The price is expected to remain around K1,278,000 per tical this week,” said YGEA General Secretary U Win Myint.
The foreign demand for gold from neighbouring markets of China and India raised the domestic gold price last week. Additionally, the local forex market saw a slight gain of US dollar against Kyat then.
On 1 July, a yellow metal was priced around K1,220,000 per tical. It gradually went higher and reached a high of K1,300,000 per tical on 22 July.
Meanwhile, gold price was pegged at US$1,780 per ounce on 1 July and hit an all-time high of above $1,850 per ounce on 22 July.
Following the record-high of $1,939 per ounce in the global market, the domestic gold fetched around K1,296,500 on 27 July, as per the YGEA’s market data.
It is a week that the global gold prices keep rising $15 per ounce every day, the YGEA stated.
We cannot predict the gold price as it is fluctuating up and down by K10,000 per day, said a gold trader Ko Cho Gyi from Yangon gold market.
In early September last year, the price of pure gold reached an all-time record of above K1,300,000 per tical in the domestic market, while the price of gold was pegged at just US$1,550 per ounce in the global market.
According to gold traders, during the past four months, the local gold reached the lowest level of K1,148,000 (31 March) and the highest level of K1,218,600 (4 March). In April, the coronavirus risks shut down the gold market, and the market was reopened on 18 May, with the minimum rate of K1,214,100 (27 May) and the maximum rate of K1,236,000 (18 May). The price moved in the range of, K1,209,600 on 6 June and K1,219,500 on 1 June, according to gold traders. —Myint Maung (Translated by Ei Myat Mon)