Sea Street gold prices surge

The gold prices climbed sharply yesterday, with the local bullion dealers reporting a steep increase in the sovereign prices after the international gold rates rose above US $ 4,300 an ounce, amid the heightened investor demand for safe-haven assets.

The price of a 22-carat gold sovereign in Colombo’s Sea Street market rose to Rs.360,600, while a 24-carat sovereign increased to Rs.392,000, from Rs.386,000 recorded on Saturday.

The traders said the local prices increased by around Rs.6,000 within hours, as the international gold rates surged and continued to influence the domestic market valuations.

The rally comes as the investors increasingly turn to gold as a hedge against geopolitical uncertainty, inflation concerns and volatility across the financial markets. 

Gold has remained one of the best-performing asset classes this year, supported by strong central bank purchases and continued demand from institutional investors.

Many households continue to view gold as a preferred store of value, particularly during periods of economic uncertainty. The industry participants said the buying interest remained steady, despite the sharp rise in prices, although the higher rates could weigh on the jewellery demand in the coming weeks.

Globally, analysts remain broadly optimistic about gold’s outlook, citing persistent geopolitical risks, expectations of further central bank purchases and continued investor appetite for safe-haven assets.

Several international financial institutions have projected that the gold prices could remain elevated through the remainder of 2026, supported by strong investment demand and uncertainty surrounding the global interest rate environment.