Gold touches historic high of Rs160,500/tola

KARACHI: Gold witnessed the record single-day increase of Rs8,500 to reach an all-time high of Rs160,500/tola on Thursday as the rupee slumped to record low in the interbank foreign exchange market.
Gold 24kt gained Rs8,500/tola and Rs7,288/10 grammes to hit Rs160,500/tola and Rs137,603/10 grammes, respectively.
The record single-day increase in the prices of gold can be attributed to massive depreciation in the value of rupee as it dived to Rs239.94 against the dollar.
Pakistan is passing through an economic crisis where the foreign exchange reserves of the country are on a continuous decline on the back of rising import bill while the country is witnessing very low inflows of the greenback.
Demand for the dollar was on the rise as importers rushed to buy the dollar for import payments while the exporters are holding receipts in expectation of better yield as the local unit is posting losses on a daily basis.

The prices of the yellow metal has also recorded an increase in the international market where it gained $19/ounce to reach $1,740 which also played its role in the hiked gold prices in the local market.
The local unit has been in a free-fall as the forex reserves of the country depleted to an alarmingly low level. The foreign currency reserves held by the State Bank of Pakistan (SBP) recorded a decline of $389 million to reach $9.32 billion during the week ended July 15, compared with $9.71 billion on July 7.
The overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $15.24 billion. The net reserves held by banks amounted to $5.91 billion.
Pakistan needs inflow of foreign exchange to boost its dwindling reserves. Although Pakistan and the International Monetary Fund (IMF) have agreed to resume the Extended Fund Facility (EFF) programme but any funds have not yet been materialised.
The price of silver also witnessed an increase of Rs30/tola to reach Rs1,630 while it recorded an increase of Rs25/10 grammes to hit Rs1,397.46/10 grammes. The international silver prices were recorded at $19.40/ounce on Thursday.