Gold prices at new peak

KARACHI: Gold prices surged to record highs in international as well as local markets on Wednesday.

In the domestic market, prices increased by Rs110 to Rs40,275 per tola (11.7 grams). Meanwhile, the rate for 10 grams of the precious metal increased by Rs94 to Rs34,521.

Local dealers have attributed the change in bullion rates to rising rates of gold in international markets where prices stood at $1,269 per ounce, after peaking at $1,271.70 per ounce in intra-day trading.

Market analysts blamed disappointing reports on Europe’s economy and a weak dollar for investor’s increasing interest in commodities, including gold. They also pointed out the seasonal increase in the demand for the precious metal that is historically witnessed around this time of the year.

Gold prices had settled during August but a string of disappointing economic reports, starting with massive job losses reported in the US during the previous month, helped prices rally in recent days.

Dealers cited international movement coupled with local interest as reasons for the rising trend and were predicting further increases in prices.

“Demand has been increasing prior to Eid and we expect it to stay strong because of the upcoming wedding season,” commented president Pakistan Gold Dealers Association, Haroon Chand.

“We expect the market to remain bullish, pushing up prices further during the rest of the week,” he added.

Published in The Express Tribune, September 16^th, 2010.