Gold prices slump Rs7,200 per tola in a week

June 24, 2023 (MLN): Domestic bullion went down on Saturday, extending losses throughout the week with 24-karat gold closing at Rs214,500 per tola, dipping by Rs2,500 on the day.

Gold prices during the outgoing week fell by Rs7,200 per tola.

According to the Karachi Sarafa Association, the price of 10-gram 24-karat gold reached Rs183,900 per tola, shrinking by Rs2,143 on the day.

While 10-gram 22-karat gold stood at Rs168,574, marking a decline of Rs1,965 for the day.

Similarly, the price of silver fell in the domestic market, with 24-karat silver falling by Rs50 to close at Rs2,500 per tola and the price of 10-gram 24-karat silver closing at Rs2,143 per tola, declining by Rs42.87 on the day.

On the other hand, international spot gold closed at $1,921.26, down by 1.85% in the week.

Earlier this week, Federal Reserve chair Jerome Powell said that policymakers expect interest rates to move higher, but at a more moderate pace to reduce the hardship that high inflation is causing.

However, Fed officials estimated rates would rise to 5.6% by the end of the year, according to their median projection, implying two additional quarter-point hikes following surprisingly persistent inflation and labor-market strength.

The U.S. dollar index (DXY) appreciated by 0.56% on the week, which makes dollar-denominated gold expensive for investors holding other currencies.

Moreover, the Bank of England raised its key interest rate by 50 basis points to 5% on Thursday, seeking to curb the highest inflation in any major economy. 

Meanwhile, international spot silver closed at $22.44, marking a decline of 7.28% for the week.

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