Gold reaches historic high of Rs144,000/tola

KARACHI: The prices of gold gained Rs1,000 in the local market to an all-time high of Rs144,000/tola on Thursday as the rupee depreciated to another fresh low.

Gold 24kt gained Rs1,000/tola and Rs857/10 grammes to hit Rs144,000/tola and Rs123,475/10 grammes, respectively.

The precious metal rose to another record high as the dollar jumped to record high against the local unit in the interbank foreign exchange market due to depleting forex reserves of the country.

The government also reached out to the International Monetary Fund (IMF) to resume and extend the Extended Fund Facility (EFF) programme in order to provide some stability to its forex reserves, however it has not been successful in convincing the IMF to release the much needed funds.

Previously, the government took various measures to minimise the current account deficit by banning the import of various non-essential and luxury items, besides slashing subsidies on the prices of fuel and electricity, a prerequisite condition by the IMF for the resumption of negotiation.

These measures were expected to lend some support in building the country’s forex reserves, however higher import bill on the back of elevated global commodity prices and minimal growth in the exports widened the current account deficit which kept the rupee under immense pressure.

The upsurge in the global commodity prices also resulted in the rupee depreciation. However, the lack of foreign exchange reserves are the major concern for the market.

The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell $497 million to $9.226 billion by the week ended June 3, 2022, compared with $9.723 billion a week ago.

Previously, the foreign exchange reserves held by the central bank were recorded at $9.233 billion on December 6, 2019. The foreign exchange reserves held by the central bank witnessed a record high of $20.146 billion by the week ended August 27, 2021.

Overall, the foreign exchange reserves of the country declined $595 million to $15.176 billion by the week ended June 3, 2022, compared with $15.771 billion a week ago.

The price of gold in the international market declined $14 per ounce to $1,819/ounce.

The price of silver was recorded at Rs1,560/tola and Rs1,337.44/10 grammes, respectively, while the international silver prices were recorded at $21.40/ounce on Thursday.