KARACHI, May 10: Local bullion rates made another history on Wednesday by touching Rs13,673 per 10 grams from Rs13,273 on Tuesday, showing a jump of Rs420 in the last 24 hours.

The price of 24-carat gold hit a new peak of Rs13,099 per 10 grams last week. Gold rates have seen a jump of Rs574 per 10 grams from May 3.

From January this year, the price of per tola gold has surged by Rs4,250. The current rate of one tola gold is Rs15,950 as compared to Rs11,700 on January 1, 2006. The 10-tola gold bar (usually called biscuit in bullion language) now costs Rs159,500 as compared to Rs117,000.

Comparing with the price of Rs9,900 per tola on January 1, 2005, the total increase in price till to date is Rs6,050 per tola.

The gold price had touched the new peak of Rs12,000 on April 18 when international rates hit a record 25-year high to $616 per ounce from $593 on April 17. The international rate of yellow metal has crossed $700 per ounce for the first time in 25 and half years. Last week it was $662 per ounce.

All Pakistan Gem and Jewellers Merchants Association Chairman Saeed Mazhar Ali attributed higher gold rates to weakening of the local currency against the dollar.

The international gold rate may reach 1980’s historic high level of $850 per ounce in coming months on the warming up of the Iran issue. “It is assumed that the local gold rate will hover between Rs18,500 and 19,500 per tola in case the dollar stays at Rs60,” he said.

Gold had struck the historic peak of $850 per ounce in the world markets in January 1980. During the whole year of 1980, the average rate of gold was $750 per ounce. It also touched $800 per ounce, he said.

However, in 1980, the impact of rising global gold rates on the domestic price could not be felt as the rupee-dollar parity was very low. In 1980, the greenback was equal to Rs9-10. Gold was available at Rs2,350 per tola, Mazhar said. “Any further devaluation of the local currency against the dollar will further impact on the gold rate,” he added.

He said the financial experts of China had advised their government to pile up extra 5,000 tons of gold reserves. Besides China, Russia and Japan have been active in storing gold reserves.

Mr Ali said gold jewellery sales had been normal as investors continued to invest in gold bars and coins.

Haji Mohammad Farooq, Chairman of the Bullion Exchange at Sarafa Bazar, says international gold rates will continue to remain high as long as the Iran nuclear issue lingers on coupled with rising crude oil prices.

He claims that at present the gold rate in Pakistan is cheaper than Dubai. Investors in Pakistan have been very active since the yellow metal has started shinning brighter in terms of its value, while the people associated with gold business are a bit reluctant to play in the yellow metal, he added.

However, Haji Farooq said the sale of jewelleries was hit by rising gold prices. “Families come in the market for jewellery sets with a fixed budget, so how can they buy excess when prices are rising very fast,” he added.