KARACHI: Gold hit a new all-time high at Rs69,600 per tola (11.66 grams) in Pakistan, as the global commodity outshined due to support coming from the weakening US dollar at world markets, ahead of the release of the US Fed outlook on its interest rate regime.
Bullion surged by a notable 1.6%, or Rs1,100 per tola, to a record high, in line with the uptick in international markets, where it recovered by a staggering $16 an ounce (31.1 grams) to a 10-month high of $1,344 per ounce. The increase came just before the All Sindh Saraf and Jewellers Association announced the gold price for local markets for the next 24-hours in the second-half of the day on Wednesday, according to the association.
“A 32% rupee depreciation against the US dollar in the last 14 months helped gold price surge higher in Pakistani markets than the global one,” Arif Habib Commodities CEO and MD Ahsan Mehanti told media.
“The gold price surged ahead of the release of US-FOMC (Federal Open Market Committee) minutes of the January meeting (at around 24 o’clock according to Pakistan’s standard time on Wednesday), which is expected to hint a status quo in US interest rate (at 2.5%), going forward,” Pakistan Mercantile Exchange (PMEX) officials disclosed on the condition of anonymity.
“The US dollar index (a basket of world’s major currencies) has weakened over 1% in the recent days. The situation invited increased trade in gold at PMEX,” he said.
Trading in bullion improved over 60% in recent days at PMEX, he cautiously estimated. “The Pakistan-India tension on the border made investors in Pakistan return to safe haven,” Mehanti said.
Rays Commodities Chief Operating Officer Adnan Agar anticipated gold may go as high as $1,358-1,360 per ounce under the current cycle of uptick at world markets.
He said going forward, the likely status quo in the US interest rate is expected to keep the dollar weak and fuel uptick in gold at global markets.
