Gold surges to Rs118,000 per 10g

Author: Monitoring Desk

Gold price remained higher on Thursday as the US dollar suffered after the weaker-than-expected private-sector employment growth and the treasury bond yields stayed in negative territory near 2.9 percent.

As of 1255 hours GMT, the gold future were available at $1,856.90 per ounce, showing an increase of $10.40 (+0.56 percent). Out of the $10.40 per ounce increase, +$9.40 was due to weakening of the US dollar and +$1 was due to predominant buyers, according to Kitco Gold Index. The price of 10 grams of 24-carat yellow metal in Pakistan, meanwhile, increased to Rs118,000, showing an increase of Rs1,000 (+0.85 percent). Gold price in the local market remained Rs117,000 on Wednesday last. A relatively higher increase in the local gold prices was due to overnight upward change in the global prices when the local market was closed. However, the Pakistani rupee’s appreciation against the US dollar, which appreciated by 0.14 percent during the day, trimmed local prices to some extent.

Gold price is building on the previous rebound from ten-day lows of $1,829 and continues to push higher towards $1,860. The US Treasury yields are also on a retreat across the curve, adding to the downside in the greenback. The pullback in the US rates could be associated with the profit-taking slide after the benchmark 10-year US yields faced rejection just below the key 3 percent level.

The bright metal also continues to benefit from the persistent concerns over surging inflation globally, which could temper the economic outlook. Further, the renewed US-Sino trade concerns and the ongoing Russia-Ukraine crisis keep the sentiment around the traditional safe-haven buoyed. Investors remain worried that central banks can hike interest rates to curb inflation without impacting economic growth. Gold, which is often seen as a hedge against inflation, could further benefit from concerns that the global supply chain disruption would push consumer prices even higher.

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