May 21, 2003	Wednesday	Rabi-ul-Awwal 18,1424

KARACHI, May 20: Gold prices in local bullion market surged by Rs527 per 10 grams in the last 20 days to Rs6,875 from Rs6,348 in view of rising prices in world markets.

The gold price on international bullion markets quoted at $368 per ounce on Tuesday, showing a rise of $37 per ounce in the last 20 days.

Since April 7 (Rs6,095 per 10 grams), gold prices have witnessed a rise of Rs780, thus giving hard times for consumers to bear additional cost in view of ongoing marriage season after Rabi-ul-Awal. On April 30 international gold price was staying at $331 per ounce.

Jewellers in the market said that rising prices would hardly make any negative impact on current buying spree as consumers are bound to purchase gems and jewellery in order to fulfil a basic requirement for providing financial security to the bride.

Gold rates in local markets usually rely on the fluctuations of global bullion rates coupled with changes in the domestic rupee-dollar parity.

As far as the rupee position is concerned it had gained its strength by 4.6 per cent in kerb market and four per cent in inter-bank against the dollar during July-April 2002-2003, thus making imports cheaper. But gold dealers said that sky-rocketing price in international market has totally offset the impact of falling dollar coupled with suspension of imports by three to four major players in Pakistan.

“We have suspended imports as global rates are not affordable for the key market players in Pakistan,” Chairman All Pakistan Gem Merchants and Jewellers Association (APGMJA), Kamran Khan told Dawn on Tuesday.

Falling dollar value against the euro, lacklustre trend in European and American bourses, Middle East crisis, Palestine- Israel row and Sars in various countries are the key factors, thus attracting foreign investors to cash their luck in gold all over the world instead of other investment options, he said.

“I think international gold price would range between $380-390 per ounce in future in case investors continue to prefer piling up huge stocks of bullion worldwide,” Kamran said.

As far as Pakistani bullion markets are concerned, investors are reluctant to build up inventory of yellow metal as they now have better options like booming real estate prices in posh areas of the city coupled with euro buying against the greenback and some enthusiasm in equity investing.

“I think investors are very much active in property market these days and they give second preference to investing in euro and stock markets,” APJMJA chief said.

Consultant, World Gold Council (WGC), Syed Faisal Hashmi said that investors are now much interested in property, bourses and euro instead of putting up their investment in gold bars and coin.

“In case investors in world markets switchover from gold to other investment options — the price of yellow metal in world markets will tumble automatically.

Huge presence of investors is the main reason of flaring up gold prices in international markets,” he said.