KARACHI: The prices of gold witnessed a significant hike of Rs2,350 in the local market to an all-time high of Rs141,650/tola on Monday as the domestic political and economic crises pushed the rupee to record low.
Gold 24kt gained Rs2,350/tola and Rs2,015/10 grammes to hit Rs141,650/tola and Rs121,442/10 grammes, respectively. The precious metal recorded the previous all-time high of Rs138,700/tola on Friday, May 20.
The latest escalation in the prices of gold was recorded amid a continuous decline in the value of local currency against the greenback, as the rupee hit the historic low of Rs200.93 in the interbank foreign exchange market.
Pakistan is going through one of its worst economic and political crises where deteriorating macro-economic indicators coupled with political instability dented the investors and traders’ confidence.
The local currency has been on a downward stream amid depleting forex reserves, ballooning current account deficit on the back of higher import bill due to elevated global commodities prices.
With the PTI’s announcement of the date for the long march against the government and to call for early elections, the political atmosphere heated up resulting in more uncertainty in the national political environment.
The dialogues between Pakistan and the International Monetary Fund (IMF) resumed for the revival and extension of the Extended Fund Facility (EFF), however, a positive outcome is unlikely as the government maintained the subsidies on the prices of fuel and electricity, bringing the government at odds with the IMF.
The price of gold in the international market also increased $15 per ounce to $1,862/ounce.
Pakistan’s forex reserves reduced to an alarming level, as the foreign exchange reserves held by the State Bank of Pakistan (SBP) were down $145 million to $10.16 billion on a weekly basis, compared with $10.30 billion on May 6.
The overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $16.16 billion, while the net reserves held by banks amounted to $5.99 billion.
The price of silver witnessed an increase of Rs20 to Rs1,590/tola and Rs17.17 to reach Rs1,363.16/10 grammes, respectively, while the international Silver prices were recorded at $22.18/ounce on Monday.
