Gold hits all-time high of Rs182,800/tola

KARACHI: Gold extended its gains to hit the fresh all-time high of Rs182,800 on Wednesday as the yellow metal is in high demand in the local market due to the dollar’s flight against the rupee.

Gold 24kt gained Rs100/tola and Rs85/10 grammes to hit Rs182,800/tola and Rs156,721/10 grammes, respectively.

Experts are of the view that gold prices have been on an upward trend as the investors opt for safe haven assets, due to the scarcity of the greenback and spiking inflation.

The price of gold changes in line with the movement of the rupee, which remained under pressure owing to reduced business activities and lack of inflows to boost the foreign exchange reserves.

The foreign currency reserves held by the State Bank of Pakistan (SBP) dropped down $584 million to reach $6.1 billion during the week ended December 16, compared with $6.7 billion on December 9.

The forex reserves are down to levels worth just eight weeks of imports, their lowest since April 2014.

The overall liquid foreign currency reserves held by the country including net reserves held by banks other than the SBP stood at $12 billion. The net reserves held by banks amounted to $5.88 billion.

Despite a decline in the international prices, the local gold prices remained on an upward stream as Pakistan’s economy continued to bear the pressure of rising inflation and dollar’s flight in the interbank foreign exchange market.

In the international market, gold prices fell on Wednesday from last session’s six-month peak as the dollar firmed and Treasury yields remained elevated, while investors weighed the worsening Covid-19 situation in top bullion consumer China.

Spot gold fell 0.5 per cent to $1,804.48/ounce, having hit its highest since the end of June on Tuesday, while spot silver fell 0.6 per cent to reach $23.89/ounce

In the local market, the prices of silver remained at Rs2,050/tola and Rs1,757/10 grammes.

The price of gold is Rs5,000/tola over-cost in the country, compared with its price in Dubai.

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