ISLAMABAD
Gold prices in the local market remained on an upward slide on Monday toeing the international market, and price of one tola of 24-karat gold reached Rs223,800.
According to the All-Pakistan Sarafa Gems and Jewellers Association (APSGJA), the price of one tola of 24-karat gold increased by Rs1,000 to Rs223,800 from Rs222,800. Similarly, the gold price for 24-karat was recorded at Rs 191,900 per 10 grams as per the bullion market.
The major reason for the increase in prices in the local market is because of the international rates as well as PKR-USD parity.
In the global markets, the US dollar and gold go inverse, as if the dollar weakens then gold raises and vice versa.
As of 1300 hours GMT, gold futures in the international market were available at $1,966.60 per ounce, showing an increase of $5.70 (+0.29 percent). Out of the $5.70 per ounce increase, -$2.15 was due to strengthening of the US dollar and +$7.85 was due to predominant buyers, according to Kitco Gold Index.
Gold price gained traction and advanced toward $1,970. The benchmark 10-year US Treasury bond yield went down more than 1 percent on the day near 3.8 percent, supporting gold’s rebound.
Gold price juggles in a narrow range after a three-day correction from the immediate high of $1,984. Gold price is portraying a non-direction performance as investors await the interest-rate decision by the Federal Reserve (Fed) for further guidance. The precious metal is expected to continue its lackluster performance as a small interest-rate hike from the Fed is widely expected despite softening inflation and loosening labor market conditions.
There is little doubt among investors that the Fed will increase interest rates to the 5.25-5.50 percent range as the core Consumer Price Index (CPI) is still stubbornly high partly due to the resilience in consumer spending. A catalyst to which investors are keeping an eye is the interest-rate guidance from the Fed. Fed officials and investors have divergent views about where interest rates will peak for the current year as the former signaled that two more interest-rate hikes are appropriate while market participants are expecting that the upcoming interest-rate increase will be the last one this year.
