Monday, January 16, 2023
Gold rally petered out Monday in line with the market buzz that the yellow metal was primed to hit a big correctional bump in the road soon after gathering a winning momentum taking utmost advantage of an anaemic rupee and elusive dollar.
The precious commodity gained Rs7,300 per tola in the last three trading sessions (Thursday-Saturday).
Data released by All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the price of gold plunged Rs2,800 per tola and Rs2,401 per 10 grams to settle at Rs184,500 and Rs158,179.
Last week, gold prices remained volatile during the week, with the precious commodity undergoing correction during the first three sessions; however, it regained its shine. The price rose by Rs2,000 during the volatile week that ended on January 14.
The association reported that the price of gold has been “overcost” by Rs2,000 per tola in Pakistan, as compared to prices in Dubai. This means that, at present, the Pakistani gold market is more expensive than the world market.
It should be noted that the majority of the buyers in the local market comprise gold investors these days. Earlier, they were parking their savings in the US dollar to avoid the impact of rupee devaluation at a time of high inflation.
Goldsmiths believe that the investors started moving to the bullion market following the shortfall of the dollar in the open market. In the black market, illegal traders were selling the dollar for Rs280-290 compared to Rs228 in the interbank market.
Meanwhile, silver prices in the domestic market fell by Rs20 per tola and Rs17.15 per 10 grams to settle at Rs2,080 and Rs1,800.41.
In the international market, the gold price slipped from a more than eight-month high on Monday as the dollar firmed, although expectations that the US Federal Reserve will be less aggressive in raising interest rates kept bullion well above $1,900 per ounce. The price settled at Rs1,915 per ounce after a decline of $5.