The Global Gold Rush: Is It a Safe Bet for Nepali Investors?

By Surya Prasad Sharma – Experienced Banker & Financial Expert
Posted: April 2025

Introduction

As a banker with nearly two decades of experience in Nepal’s financial sector, I’ve witnessed how economic shifts influence investment choices. Recently, the world has seen an unprecedented surge in gold prices, capturing the attention of investors globally—and here in Nepal too. Last week, gold prices in Nepal hit a remarkable NPR 1,80,300 per tola, sparking debates about its value as a safe investment. Let’s dive into this trend, explore its implications, and assess whether gold remains a risk-free option for Nepalis like

The Global Gold Boom

Gold has long been a symbol of wealth, from ancient kingdoms to modern economies. Today, its price has soared to over $3,125 per ounce internationally, driven by global uncertainties—geopolitical tensions, trade wars, and inflationary pressures. Historical data shows gold’s value has climbed from a modest $4.25 per ounce in 1717 to this historic high in 2025. Key drivers include:

• Supply Constraints: With 205,000 metric tons already mined and only 50,000 tons left, experts predict supply will dwindle within 20-30 years.
• Demand Surge: About half of global gold is used for jewelry, 20% is held by central banks as a financial safeguard, and 30% supports industries and medicine.

This imbalance between limited supply and rising demand suggests gold prices could climb to $5,000 per ounce in the next decade, though economic recoveries or central bank sales might push it down to $2,000 per ounce.

Gold in Nepal: A Local Perspective

In Nepal, gold isn’t just a luxury—it’s a cultural and financial asset. From the Licchavi era, when King Manadeva introduced gold coins, to the Malla and Shah dynasties, gold has been a trusted medium of exchange. Today, it serves as both jewelry and a quick liquidity option, with banks offering lockers to secure it against theft.

However, Nepal’s gold prices don’t mirror global trends alone. Over the past 20 years, the price per tola has jumped from NPR 11,430 to NPR 1,55,250—a staggering 1,258% increase, far outpacing the global rise of 482%. Why?

• Rupee Depreciation: The Nepali rupee has weakened by 332% against the U.S. dollar over 30 years due to trade deficits and global economic shifts.
• Import Costs: High customs duties (8-20%) and trader margins (around 1%) inflate local prices.
• Dollar Dependency: Since gold is imported and priced in dollars, a stronger dollar amplifies costs here.

Looking ahead, if trends persist, gold could reach NPR 3,00,000 per tola in 10 years. In a stable scenario, it might settle at NPR 2,50,000, or drop to NPR 1,50,000 if global prices fall.

Is Gold a Safe Investment?

As a financial professional, I see gold as a robust long-term investment, especially in Nepal. Its role as a hedge against inflation and currency depreciation makes it resilient. Even if global prices dip, the rupee’s weakness and import tariffs cushion local values, reducing downside risk.

• Pros: Easy to liquidate, culturally significant, and a hedge against economic instability.
• Cons: Short-term volatility and storage risks (mitigated by bank lockers).

For Nepalis, gold remains a dependable asset, particularly for those planning for the future or seeking stability amid global uncertainty.

My Takeaway for Investors

With my background in banking and portfolio management, I recommend keeping an eye on gold as part of a diversified strategy. Its historical stability, combined with Nepal’s unique economic factors, makes it a compelling choice. However, consult with financial advisors and monitor global and local trends before investing.

I’d love to hear your thoughts! Have you considered gold as an investment? Let’s discuss in the comments.

About Me

I’m Surya Prasad Sharma, a seasoned banker with 19 years at Siddhartha Bank Limited, specializing in branch management, credit assessment, and financial solutions. Connect with me on LinkedIn for more insights!