Domestic bullion makes a strong comeback, surge by Rs4,000 per tola
MG News | July 13, 2023 at 09:16 PM GMT+05:00
July 13, 2023 (MLN): Domestic bullion made a strong comeback on Thursday, reversing losses as the price of 24-karat gold surged to Rs208,000 per tola, marking a significant increase of Rs4,000.
This gain comes after the 24-karat gold marked a decline of Rs12,000 per tola, or 5.56% since the long-standing Staff Level Agreement was signed between the International Monetary Fund (IMF) and Pakistan.
Yesterday, the IMF board approved the 9-month Stand-By-Agreement (SBA) for Pakistan for an amount of $3 billion, and today the State Bank of Pakistan (SBP) received the first installment of $1.2bn.
This inflow comes on top of a $1bn deposit from the United Arab Emirates (UAE) yesterday and a $2bn deposit from Saudi Arabia on Tuesday.
To note, as of June 30, 2023, the country's total reserves stood at $9.75bn and as per Ishaq Dar the reserves will stand at around $13-14bn by this week.
According to the Karachi Sarafa Association, the price of 10-gram 24-karat gold reached Rs178,326 per tola, rising by Rs3,429.
While 10-gram 22-karat gold stood at Rs163,466 per tola, up by Rs3,144.
Similarly, the price of silver rose in the domestic market, with 24-karat silver falling by Rs50 to close at Rs2,600 per tola and the price of 10-gram 24-karat silver closing at Rs2,229 per tola, rising by Rs42.87
On the other hand, international spot gold is currently trading at $1,960.21 marking an increase of 0.13% on the day.
The U.S. consumer price index (CPI) for June 2023 on Wednesday showed that inflation eased at 3% YoY, lower than analysts’ estimates of 3.1%.
CME FedWatch Tool is pricing a 94.9% chance of an interest rate hike at the upcoming FED meeting.
Interest rates and gold have an inverse relationship, as gold loses its attractiveness in an environment of high-interest rates.
Moreover, the U.S. dollar index (DXY) has also continued its downward trajectory for 6 consecutive trading sessions, currently 0.55% lower on the day, this makes dollar-denominated gold cheaper for investors holding other currencies.
Meanwhile, international spot silver is currently trading at $24.71, soaring by 2.41% on the day.
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