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Why Gold Prices Are Rising in 2026 — Explained for Sri Lanka

Central banks keep buying

Reserve banks across Asia and the Middle East have been adding gold to their reserves for years, reducing dependence on the US dollar. That steady official demand removes supply from the market and supports higher prices.

Inflation and currency protection

When money loses purchasing power, gold holds it. Sri Lankan households learned this first-hand during the currency crisis — families who held jewellery preserved value far better than those holding only cash.

Lower interest rates worldwide

Gold pays no interest. When bank rates fall, the opportunity cost of holding gold falls with them, so investors move money into bullion and ETFs, lifting prices.

The USD-LKR effect at home

A weaker rupee raises the local price of an imported commodity even when the global price is unchanged. This is why Colombo rates sometimes rise on a quiet international day.

What a higher price means for you

Higher rates mean broken chains, single earrings and old wedding jewellery sitting at home are worth more today than a year ago. Bring them in for a free valuation and see the number for yourself.

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