December 16, 2023 (MLN): Gold prices in Pakistan increased this week as the price of 24-karat gold rose by Rs1,200 per tola and settled the week at Rs216,800.
However, compared to the previous session’s closing, the 24-Karat gold lost Rs1,800 per tola.
The Karachi Sarafa Association reported that the price of 10-gram 24-karat gold closed today’s session at Rs185,871, reflecting a loss of Rs1,543.
While the price of 10-gram 22-karat gold stood at Rs170,382, down by Rs1,414.
The price of silver remained unchanged in today’s session, with 24-karat silver and 10-gram 24-karat silver closing at Rs2,670 and Rs 2,289.09.
It is crucial to mention that the domestic bullion market witnessed a major setback last week as 24-Karat gold plunged by Rs8,000 per tola, driven by a significant decline in international prices and a strengthened local unit.
Conversely, the uptick in commodity prices in international markets this week resulted in a turnaround for the domestic bullion.
International spot gold closed the week at $2.019.54, marking a gain of $15.
International gold rebounded this week following the US Federal Reserve's statement hinting at a cumulative rate cut of 75 basis points in 2024.
As a result, the U.S. treasury yields and the dollar remained under pressure throughout the week.
The U.S. Dollar Index (DXY), which tracks the value of the greenback against six other top currencies fell by 1.34% WoW after experiencing recovery in the last week.
Moreover, the 10-year U.S. government bond yield dropped to 3.91% in contrast to the rate of 4.23% at the close of the preceding week.
A weaker dollar makes gold more affordable for holders of other currencies, exerting a positive impact on gold prices.
Similarly, lower bond yields also impose a positive impact on the metal as they reduce the opportunity cost of holding the safe-haven asset.
In the domestic market, gold prices are also influenced by fluctuations in the local exchange rate.
The Pakistani Rupee (PKR) extended its upward momentum by achieving its fifth straight weekly victory against USD, mainly due to positive sentiments in the market after the succesfull staff-level agreement with the International Monetary Fund (IMF).
Since gold is denominated in U.S. dollars, when the domestic currency appreciates against the greenback, the value of PKR-denominated gold falls.
However, the surge in the international market overshadowed the appreciation in the local unit, ultimately leading to gains for the domestic bullion market.
Copyright Mettis Link News
Posted on: 2023-12-16T15:45:14+05:00
