LAHORE: The rates of gold have dropped to Rs 46,500 per tola across the country week-on-week (W-o-W) basis, on the back of plummeting prices up to $30 per ounce in the global gold market. The price of precious metal in the local market has been decreased by almost Rs 1,000 per tola (11.25 grams) in last week.
The thorough study of gold prices revealed that the downward trend in prices have been continuing since last six months in the country because of many factors. However, if upward trend of dollar did not exit and greenback remained under Rs 100 per dollar, the rates of gold might have been under Rs50,000.
It is a pity that dollar is melting down in international currency market against yen, franc and pound while it is gaining weight against Asian currencies including Malaysia, India and Pakistan.
Market sources are of the view that rates of yellow precious metal had been dropped to a three-year low in the international market to near $1,375 an ounce, putting it on course for its worst quarterly performance in over half a century.
An office-bear of Lahore Sarafa Bazar Association on the condition of anonymity predicted that gold prices would further drop in the coming days without giving solid reasons. When asked that dollar is gaining more value against local currency, how is it possible that gold prices would be tumbled, he could not rationalize his answer.
However, he had firm belief that gold prices would further come down in the near future. While predicting further decrease in gold prices, he said that rates of gold are expected to be dropped down up to Rs40,000 per tola.
On the other hand, precious yellow metal prices have been surged in New York and other business hubs of the world on W-o-W basis since spot gold was up 0.7 percent at $1,375.40 an ounce on Tuesday trading, having previously hit a session low at $1,352.20, while US gold futures for December delivery were up $9.60 at $1,375.30 an ounce despite the fact that dollar index fell 0.5 percent, tracking a drop in US Treasury yields and as investors chose safe haven currencies over the dollar in the uncertainty ahead of the release of the Fed minutes.
While giving reasons of declining prices of gold in the country, experts are of the view that as value of the dollar is increasing, therefore, people have started selling their gold to buy currency.
Earlier they were selling off dollar to buy gold, they said adding that America’s economy is improving as Obama administration has improved its relationship with North Korea, Iran and other nations, giving a boost to US economy.
Though few traders are of the view that rates of precious yellow metal would further drop in the country but it is expected that prices of gold would surge in the coming days as Pakistani investors have no role in fixing gold price locally.
Only US government and international investors can fluctuate gold prices globally according to their aspirations otherwise local investors just conceived international trend and set prices of gold locally according to dollar parity.