KARACHI: The price of 10 gram and one tola gold in domestic market went up by Rs428 and Rs500 respectively on Wednesday, following the $20 per ounce hike in world gold price after Donald Trump’s surprise win in the US elections.

The 10 gram gold price and one tola gold price were quoted at Rs44,742 and Rs52,200 respectively based on world gold price of $1,304 per ounce.

According to BIPL Research, gold prices surged higher by about five per cent early today, the biggest rally since Brexit as investors rushed towards safe haven assets after the Republican candidate’s victory.

However, the yellow metal has lost some value after making a high of $1,338/oz as global equities and dollar recovered after the plummet. Most analysts believe prices could rise further amid uncertainty in the global markets, BIPL said.

Domestic gold price moves both ways on the price trend in world markets but it has been observed that a local gold trade body issues daily price which do not reflect real increase/decrease in international price.

For example, on Nov 5, 2016 the trade body issued local rate of Rs44,571 for 10 grams and Rs52,000 per tola rate based on international price of gold at $1,305 per ounce. On Nov 1, 2016, the per 10 gram and per tola rates were issued at Rs44,571 and Rs52,000 respectively on the basis of $1,285 per ounce price in global market.

On Oct 17, 2016, world gold rate was $1,254 per ounce but the local rates were Rs43,714 and Rs51,000 per 10 grams and per tola. On Oct 6, the global rate was quoted at $1,268 per ounce but the local prices were fixed at Rs43,457 and Rs50,700 per 10 grams and per tola respectively.

However, the rupee-dollar parity had not shown any wild fluctuations in the last few months but the domestic gold rates appear to have not been at par with the movement in world gold rates.

President All Karachi Saraf and Jewellers Group Haji Haroon Rasheed Chand said the association issues daily local rate by linking it to the opening London rates in the afternoon and closing USA rates in the evening.

Published in Dawn November 10th, 2016