KARACHI: Gold scaled to a new peak on Friday as the political uncertainty clouded the economic outlook and bolstered bullion’s safe-haven allure, though analysts said the rapid pace of gains could prompt some correction.
Data released by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the gold price rose by Rs750 per tola and Rs643 per 10 grams to settle at Rs163,500 and Rs140,175.
The stability of the rupee against the US dollar at a record high level is believed to be the primary reason behind the spike given that Pakistan meets its demand for the precious metal through imports.
Meanwhile, stock market participants are diverting investment to gold because the bourse is experiencing selling pressure due to overheating of the economy.
Gold is once again attracting safe-haven investment. Analysts suggest that people usually take positions in gold during inflationary times and at present inflation is the largest challenge in Pakistan.
The gold price for local markets is determined by keeping in view its prices in world markets, rupee-dollar exchange rate, and demand and supply in domestic markets. The latest price for local markets was determined to keep in view the prices at which trade took place among buyers and sellers.
In the international market, the price of the yellow metal surged by $19 per ounce settling at $1,799 as cautious investors positioned themselves for US jobs data, but safe-haven bullion was still bound for a second straight weekly gain on expectations of a moderation in the pace of US rate hikes.
Gold rates in Pakistan are around Rs1,000 below the cost compared to the rate in the Dubai market.
Meanwhile, silver prices in the domestic market surged by Rs10 per tola and Rs8.58 per 10 grams to settle at Rs1,780 per tola and Rs1,526.06 per 10 grams.