Gold prices in Bangladesh have surged to record highs, following a global rally that pushed bullion above $4,000 an ounce. The increase is driven by global economic uncertainty, central bank purchases, and the depreciation of the taka. Domestic demand continues to outstrip supply, further tightening the local market.
Gold Prices in Bangladesh Hit Record Highs Amid Global Bullion Surge
Gold prices in Bangladesh have soared to unprecedented levels, mirroring a worldwide rally that has lifted the price of bullion above $4,000 per ounce (28.3495 grammes). The Bangladesh Jewellers' Association raised local gold rates to Tk 209,100 per bhori (11.664 grammes) — the highest on record — from the previous day.
GLOBAL BULLION RALLY
The global surge in gold prices is being driven by expectations of US interest rate cuts, heightened geopolitical and economic uncertainty, and strong central bank purchases. According to Reuters, spot gold held steady at $4,037.95 (Tk 491,000) yesterday, underscoring the strength of the ongoing rally.
SAFE-HAVEN DEMAND AMID GLOBAL TURMOIL
Gold’s appeal as a safe-haven asset has strengthened during periods of inflation and economic downturns, as investors seek assets that retain or appreciate in value during uncertain times. From the Russia-Ukraine war to the Israel-Gaza conflict, global investors are increasingly turning to gold for security.
Gold also recorded notable spikes earlier this year — first in April, when US President Donald Trump launched a trade war against several countries, and again in August, after he criticised the independence of the Federal Reserve, the US central bank, Al Jazeera reported.
CENTRAL BANKS ACCUMULATE GOLD
Since 2022, central banks around the world have collectively purchased over 1,000 tonnes of gold annually — more than double the average of 481 tonnes per year recorded between 2010 and 2021. Poland, Turkey, India, Azerbaijan, and China were among the top buyers last year, according to a BBC report.
TAKA DEPRECIATION DRIVES LOCAL PRICE HIKES
While Bangladesh does not import large volumes of gold directly, domestic prices are heavily influenced by global trends. The local cost has surged further due to the sharp depreciation of the taka. Since FY21, the local currency has lost 43 percent of its value against the US dollar, increasing import-related expenses.
Most of Bangladesh’s gold enters the country through international travellers under the National Board of Revenue’s baggage rules.
DEMAND OUTPACES SUPPLY
Bangladesh’s annual demand for gold is estimated between 20 and 40 tonnes, with roughly 80 percent supplied through informal channels. In FY2023-24, about 45.6 tonnes entered the country — still insufficient to meet consumer demand, which peaks during weddings and festivals.
There are also claims that a portion of imported gold is smuggled out to India, keeping the domestic market tight and prices elevated.