Gold just hit record highs: what to weigh before you buy a tola now

Walk past any jewellery shop in New Road this year and the boards tell the story: gold near three lakh a tola, a number that would have sounded absurd a few years ago. Plenty of people are looking at that climb and thinking they should buy some before it goes higher. A relative asked me exactly that last month, half as an investment, half as Dashain shopping she could justify.

The honest answer is that the price on the board is the least of what you pay. Gold near a record changes the maths in ways that have nothing to do with whether gold goes up from here, and most of them work against the buyer who walks in for ornaments.

The price story, briefly

Gold's run has been real. Fine gold (chhapawal) hit an all-time high of Rs 339,300 per tola on 29 January 2026, after jumping Rs 20,500 in a single day, per the Federation of Nepal Gold and Silver Dealers' Association. It has since cooled to around Rs 285,000 by late July 2026, roughly 16% below that peak, even after the FY 2083/84 budget's customs-duty doubling briefly spiked the price by another Rs 20,500 in a day to Rs 311,100 at the end of May.

Step back and the climb is steep. A tola was about Rs 105,500 at its 2022 record and near Rs 75,000 before the pandemic, so gold has roughly quadrupled in six years, and it is up about 31% from Rs 217,100 just last September. The push is global: international spot gold was trading above 5,500 dollars an ounce at the January peak, driven by central-bank buying (official-sector purchases topped 860 tonnes in 2025), a weaker dollar, and demand for a haven. That is the backdrop. None of it tells you what gold does next, and the rest of this post is about the costs you control instead of the price you can't.

The spread is the real price

This is the fact that should govern any gold purchase in Nepal, and the one shop boards never show. When you buy ornaments, the bill is not just the gold. It carries jarti (wastage) and jyala (the making charge). A receipt-based analysis of actual jewellery purchases found wastage averaging about 14% and making charges about 4%, so close to 18% of the price vanishes the moment you walk out. Current making charges are commonly quoted in the 8-12% range depending on the design.

It gets worse on the way out. When you sell ornaments back, the jeweller deducts a commission and does not refund the making charge, so a full round trip, buy then sell, can cost up to a quarter of your money even if the gold price hasn't budged. Sell to a different shop than you bought from, or lose the original bill, and the deduction grows. For a "store of value," that is a brutal toll, and a record-high price magnifies it because the percentage is taken on a bigger number.

So before anything else, separate two intentions. If you want jewellery to wear, fine, treat the spread as the cost of an ornament you enjoy. If you want gold as an investment, jewellery is the most expensive way to hold it.

Form matters: coins and bars over ornaments

For investment, the cheaper forms are coins and bars. Pure 24-carat coins and biscuits carry little or no making charge, so their price tracks the bullion rate closely and you keep far more on resale. NRB itself mints and sells gold coins in 2.5, 5, and 10 gram sizes around some festivals such as Tihar, usually limited to one set per person and paid by cash or QR, though it has skipped some years, so availability is not guaranteed. Established dealers also sell stamped coins and bars.

Purity is the other half of the form question. Nepal distinguishes chhapawal or fine gold (24-carat) from tejabi, a slightly lower trade grade priced just under fine, and from 22-carat (91.6%) used in much jewellery. Hallmarking through the Nepal Bureau of Standards and Metrology, the "NS mark," exists but was introduced as voluntary and is not universally enforced, so purity is not guaranteed by a stamp alone. Buy from a dealer who issues a proper bill stating weight and purity. That bill is also what protects your resale value later.

Why Nepal's price sits above the world price

If you compare Nepal's per-tola rate to the international spot price converted to rupees, Nepal looks dearer. That gap is built from policy:

• A 0.5% skill promotion fee applies when gold, silver, or their ornaments are sold, introduced by the FY 2083/84 Finance Bill in place of the earlier 2% luxury tax.
• Import duty on gold is 20%, doubled from 10% in the FY 2083/84 budget after an earlier cut, and duty rates move with each annual budget, so confirm the current figure before assuming.
• 13% VAT applies to ornaments set with diamonds or gemstones, on top of the gold value.
• NRB caps how much gold commercial banks can import, recently raised to 25 kg a day, and only banks may import. That keeps official supply tight against demand and is part of why smuggling persists.

The practical upshot: a chunk of what you pay over the world price is tax and supply friction you will not recover on resale. It is a cost of buying gold in Nepal, not part of the asset's value.

Buying at a record: what you are actually betting

Gold pays nothing. No interest, no dividend, no rent. Its entire return is the price rising, which makes it different from an FD or a bond that pays you to wait. When you buy at a record, you are betting the price climbs further from an already-high base, with no income to cushion you if it doesn't.

History says caution. Gold is already about 16% below its January 2026 peak, and after the 2020 record it fell roughly 23% the following year before recovering. Records get broken, and they also get retraced. A 10-year look-back across land, NEPSE, gold, and FD shows how lumpy that path has been compared with the assets people benchmark it against. Nobody reliably times this, which is exactly why gold belongs in small, steady allocations rather than a lump bought because the headline caught your eye.

There is also no shortcut product to soften the cost. Nepal has no gold ETF, no sovereign gold bond, and no regulated digital-gold platform, so households are limited to physical metal with all the spread and storage that implies. If you want gold for the rupee hedge it can genuinely provide, the tola-by-tola math and a coin-or-bar form keep the cost down. And if you already own gold and need cash, a gold loan is usually cheaper than selling into the spread.

What you actually need to know

1. The spread is the cost that matters. Jewellery loses roughly 15-20% to wastage and making charges on purchase, and up to a quarter round-trip, regardless of the gold price. Coins and bars are far cheaper to own, and a proper bill protects your resale.
2. Nepal's price carries tax and supply friction. A 0.5% skill promotion fee at sale, a 20% import duty, VAT on gem ornaments, and a daily import cap push the local price above the world price, and none of that comes back when you sell.
3. A record price raises the stakes, not the certainty. Gold pays no income and is already off its January high; treat it as a small hedge inside long-horizon money, never as the place you park savings or the emergency fund.

Trying to decide how much gold, if any, belongs in your savings? Email parjanya57@gmail.com with what you are weighing, and I'll work through the spread and the allocation with you.

This post is part of the Nepal Money Basics guide — the investing section.