Gold hits all-time high of Rs195,500/tola

KARACHI: The price of gold shot up to an all-time high of Rs195,500 on Thursday, as the rupee slumped to the all-time low in the interbank foreign exchange market.

Gold 24kt gained Rs4,900/tola and Rs4,201/10 grammes to hit Rs195,500/tola and Rs167,610/10 grammes, respectively.

The latest hike in the price of the yellow metal came, amid a significant decline in the rupee value, which declined over Rs24 against the dollar in a single day in the interbank foreign exchange market.

The price of gold changes in line with the movement of the rupee. The local currency crashed after the government removes the cap from the exchange rate to meet the prerequisite conditions of the International Monetary Fund (IMF) for the revival of the Extended Facility Fund (EFF) programme.

Additionally, the local unit came under severe pressure, as the foreign exchange reserves of the country narrowed to an alarmingly low level.

The foreign exchange reserves of the State Bank of Pakistan (SBP) declined to $4.6 billion as of January 13, 2023, while the total foreign exchange reserves of the country stood at $10.4 billion. The commercial banks’ holdings fell to clock-in at $5.8 billion during the week ended January 13.

The prices of silver also witnessed an increase, as it gained Rs50 to reach Rs2,150/tola on Thursday.

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 the dollar’s flight in the interbank foreign exchange market.

In the international market, gold prices eased on Thursday, as the dollar firmed up, while the investors braced for the US economic data that could provide clues on whether the US Federal Reserve would further slow the pace of its interest rate hikes.

Spot gold fell 0.5 per cent to $1,936.97/ounce, after earlier hitting its highest since April 2022 at $1,949.09/ounce, while silver fell 1.2 per cent to $23.61/ounce.

The price of gold in Pakistan is Rs1,500/tola less, compared with its price in Dubai.

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