KARACHI: Gold in the domestic market touched six-year high after 10 grams and one tola prices reached Rs54,655 and Rs63,750 respectively.
The rate surge has come as a result of rising international prices of gold and fluctuations in the rupee-dollar exchange rate parity.
“The new prices of yellow metal have broken Rs54,514 per 10 grams and Rs63,600 per one tola record as observed on Nov 26, 2012,” President All Sindh Sarafa Association (ASSA) Haji Haroon Rasheed Chand said.
He said that in Nov 2012, gold prices in the international market had reached $1,748 per ounce while one dollar was equal to Rs95.90. Currently, dollar is trading at over Rs135, whereas gold in the international market is at $1,222 per ounce. Local prices are determined on the basis of exchange rates and fluctuations in world bullion prices, added Chand.
He said that the domestic gold prices have raised investors’ interest but jewellery sales have remained dormant owing to the rising prices.
He added that local buying has also dipped due to the government’s action against encroachments which have shattered the facades at shops in major jewellery markets across Karachi.
From January till date, the price of 10 grams and one tola of gold have increased by Rs6,484 and Rs7,579 respectively despite a decline of $82 per ounce in international gold prices. On Jan 1 this year, 10 grams and one tola gold rates were at Rs48,171 and Rs56,171 based on world gold price of $1,301 per ounce.
However, 18 per cent decline in rupee’s value against the dollar since December last year has pushed the prices of imported commodities upwards. According to Pakistan Bureau of Statistics, gold imports in the first four months of ongoing fiscal year dropped to 165 kg – equivalent to $6.4 million – against the 186kg – equivalent to $7.4m – during the same period last year.
On the other hand, jewellery exports during the same period surged by 65pc to $2m from $1.2m last year.
According to a report by BIPL research, gold prices inched up on Friday, set to rise for the second straight week, on safe-haven demand for the metal ahead of the G20 summit next week where the leaders of the US and China are set to discuss their trade dispute.
Published in Dawn, November 25th, 2018