August 04, 2023 (MLN): Domestic bullion went down on Thursday, with 24-karat gold closing at Rs220,200 per tola, falling by Rs2,800.
According to the Karachi Sarafa Association, the price of 10-gram 24-karat gold went down by Rs2,401 to close the day at Rs188,786 per tola.
While 10-gram 22-karat gold stood at Rs173,054 per tola, down by Rs2,200.
The decline in gold prices can be attributed to the appreciation of the Pakistani rupee (PKR) as it snapped the 3-day losing streak by appreciating 2.18 rupees against the US dollar in Thursday's interbank session.
Since gold is denominated in U.S. dollars, when the PKR appreciates against the U.S. dollar, the value of PKR-denominated gold falls.
Similarly, the price of silver diminished in the domestic market, with 24-karat silver falling by Rs50 to close at Rs2,750 per tola and the price of 10-gram 24-karat silver closing at Rs2,358 per tola, losing Rs42.86
On the other hand, international spot gold is currently trading at $1,935.42, up by 0.10% on the day.
Market participants are now monitoring the upcoming U.S. Non-farm payrolls (NFP) figures for June that will be released on Friday.
“For gold to start making some forward progress we will likely need to see an adverse reaction of the dollar to the NFP figures,” said Tim Waterer, chief market analyst at KCM Trade, as Reuters reported.
“But for the meantime, gold is trading tightly and without much spark, mostly because it’s losing out in terms of relative yield attractiveness,” he added.
The Bank of England (BoE) on Thursday raised its key interest rate by 25bps to 5.25% and warned that borrowing costs were likely to stay high for some time.
While a European Central Bank board member made the case for keeping the ECB’s interest rates at their current high level for longer.
Interest rates and gold have an inverse relationship, as gold loses its attractiveness in an environment of high-interest rates.
Meanwhile, international spot silver is currently trading at $23.53, down by 0.20% on the day.
Copyright Mettis Link News
Posted on:2023-08-04T11:17:46+05:00
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