As gold prices increased last week, the gold reserves of the Central Bank of Sri Lanka (CBSL) have dropped by almost $ 600 million this year.
CBSL data shows that on 31 December 2019, there was $ 954.88 million worth of gold reserves held by Sri Lanka.
By 29 May 2020, gold reserves had plummeted to $ 372.7 million, a reduction of $ 582 million in a span of six months.
Last week saw a hike in gold prices with the price of a 24 karat gold sovereign at Rs. 100,000, while the price of a 22 karat gold sovereign was recorded at Rs. 80,000 on Thursday (9).
Ceylon Chamber of Commerce (CCC) Chief Economist Shiran Fernando said that the increase in gold rates was due to price fluctuations in the global gold market.
“The local gold price rise is driven by global factors. This week, gold spot prices increased above $ 1,800 an ounce, which is the highest since 2011, and is up close to 20% in 2020 so far. Gold is one of the safe haven assets and does well in times of global and financial market uncertainty. With higher infection rates re-emerging globally, investors are rushing into assets like gold,” Fernando told The Sunday Morning.
(The Morning)