Gold rates jump Rs2,200 per tola

July 12, 2024 (MLN): Gold price in Pakistan extended its upward trend on Friday, with 24-karat gold gaining Rs2,200 to Rs249,000 per tola.

The gain comes after the June US inflation report showed the lowest price gains since 2021.

It is worth noting that the price has been kept Rs2,800 below its actual cost today due to a reduction in purchasing power.

The Karachi Sarafa Association reported the price of 24-karat gold at Rs213,477 per 10-gram, up Rs1,886 per tola.

Similarly, the price of 22-karat gold was quoted higher at Rs195,687 per 10-gram.

On the other hand, silver prices remained unchanged in the domestic market, with 24-karat silver being sold at Rs2,900 per tola and Rs2,486 per 10-gram.

Globally, spot gold steadied after surging past $2,400 an ounce as cooler-than-expected US inflation boosted confidence of an interest rate cut.

The yellow metal closed 1.9% higher on Thursday to record the biggest gain since March.

The positivity came after US inflation recorded the slowest growth in core consumer prices — Fed's preferred inflation gauge — since 2021.

The data prompted traders to fully price in a September rate cut for the first time in months, with at least two quarter-point moves now expected in 2024, as Bloomberg reported.

Lower borrowing costs typically benefit bullion, which does not pay interest.

Gold, now closing in on an all-time high of $2,450.07 reached in May, has rallied 17% this year despite headwinds including high interest rates and sticky inflation.

Strong buying by central banks, haven demand amid geopolitical tensions, and purchases by Chinese consumers have all acted as supports for bullion.

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