KARACHI: The gold price on Tuesday surpassed the Rs100,000-per-tola mark for the first time in the history of Pakistan, but speculative demand for the commodity remained subdued.
The price of the precious metal rose Rs700 to an all-time high of Rs100,400 per tola (11.66 grams). The increase came after bullion price soared $31 to a seven-year high at $1,721 per ounce (31.10 grams) in the world market, reported the All Sindh Saraf and Jewellers Association (ASSJA).
“Gold will continue to surge in response to the coronavirus pandemic…until the world overcomes the health crisis and introduces a vaccine,” association member Abdullah Abdul Razzak Chand said while talking to The Express Tribune.
Gold emerged as a safe haven when all major world currencies were falling and stock markets had crashed due to meltdown of the global economy, he said.
“Gold may touch Rs110,000-115,000 per tola in the next one week or one month,” he predicted. “There is, however, no physical demand for gold since local markets are closed under the lockdown imposed to contain the virus.”
Responding to a question as to why the association increased the gold price by Rs700 per tola when it surged $31 per ounce in the world market compared to Monday’s increase of Rs1,400 when the global market went up by $3, he replied that the time gap between international and domestic markets, demand in the local market and rupee-dollar exchange rate were the factors that dominated the pricing formula in the country.
Rays Commodities’ former chief operating officer Adnan Agar said the other day gold would face a correction after crossing $1,700 per ounce in the international market. In the medium run, it would move in the range of $1,600-1,750 per ounce over the next one to two months, he said.
Published in The Express Tribune, April 15th, 2020.