Gold holds steady as investors await US employment data

(Khuda Ki Basti Sources)Price of gold in Pakistan remained unchanged at Rs125,550 per tola and Rs107,639 per 10 grams.

Rates last went up by Rs750 per tola and Rs643 per 10 grams on Wednesday.


Earlier, the precious metal had surged due to fluctuations in rupee-dollar parity, as Pakistan largely meets local demand for gold through imports.

Gold dealers, however, regret that there has not been much activity due to unstable market conditions and lack of purchasing power.

International gold prices have also been trading in a range of $1,790-1,830.

In the international market, gold recorded an increase $7 to settle at $1,834 as investors awaited US inflation data for pointers on the next moves in the US Federal Reserve’s monetary policy tightening plans.

“Gold finally appears to be rediscovering its place as an inflation hedge and is now moving independently of US yields,” said Michael Hewson, chief market analyst at CMC Markets UK.

“If inflation expectations start to increase, that could push gold higher as it could prompt the Fed to tighten too quickly and potentially slow down the global economy,” he said.

The US consumer price index for January is expected to have risen 7.3% annually, which would be the largest such increase since 1982. 

A robust inflation reading is expected to burnish gold’s appeal as an inflation hedge, but interest rate hikes would raise the opportunity cost of holding non-yielding bullion.

However, it is pertinent to mention that the gold rates in Pakistan are around Rs500 below cost compared to the gold rate in the Dubai market.

Meanwhile, silver prices in the domestic market remained unchanged at Rs1,460 per tola and Rs1,251.71 per 10 gram today.

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