October 23, 2007	Tuesday	Shawwal 10, 1428

KARACHI, Oct 22: After touching an all time high level last Saturday gold prices slightly reeled back in line with the world prices when trading resumed in local market on Monday. Gold prices surged to a historic record high on Saturday after touching Rs14,915 per 10 grams. However, some profit selling in the world market shed week-end gains and in sympathy domestic market also closed easy at Rs14,740 per 10 grams on Monday.Driven by rising oil prices gold lately remained highly volatile both in the world and domestic markets. Despite the fact that there is hardly any extraordinary demand the dealers say that the world market influences the domestic prices.

Mounting tension between Turkey and Kurds of oil producing northern Iraq has triggered new wave of price hike in gold prices for the last week or so. The other factors, which had been influencing gold prices from time to time, were US-Iran war of attrition over the nuclear issue and rapid rise in world oil prices. This compelled the investors to look for save haven.Above all weakness of dollar against euro coupled with US involvement in all sort of direct and indirect wars is forcing investors to look for investment options other than dollar and western markets.However, the domestic market, which may be following in the footsteps of world gold markets in term of price hike, has altogether different dimensions with regard to demand and buying.

“Undoubtedly, the gold price has touched all time historic level at Rs14,915 per 10 grams last Saturday, but there is hardly any worth mentioning demand at this juncture when people are bogged down to meet their both ends,” said Haji Haroon Rashid Chand, who holds a number of top slots of gold and jewellers’ trade bodies in Sindh.Gold price in the world market on Saturday last touched a record level of $765.60 per ounce moved lower to $754.50 on Monday following profit selling from investors, who took long positions.But Haji Chand is of the view that due to strong buying in the world market backed by some speculative trading, prices of gold are likely to cross $800 per ounce in the near future.

He urged the government to allow fine gold export to help bullion market create some depth and activity because presently export of jewellery is not allowed. Even Dubai allows import of pure gold from Switzerland and has no restriction over its export, which generates business activity in the market and helps create jobs. Due to lopsided policy gold prices in the domestic market are presently less than those being quoted in Dubai, he added.Market sources said that presently gold was also not being smuggled as the prices are much less than those prevailing in the Dubai market. Once the government allows free import of fine gold Pakistan may capture Indian and Bangladesh markets as well, they added.