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Gold clings to gain but caution prevails ahead of Fed meeting

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2 years ago

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  • Gold price settles at Rs151,550 per tola.
  • Price is determined keeping in view its prices in world markets.
  • Investors wait for clues on US rate hike.

KARACHI: Gold retained overnight gains in Pakistan on Wednesday in line with the international market but caution prevailed ahead of a Federal Reserve policy statement later tonight as investors waited for clues on US rate hike.

Data released by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the price of gold rose by Rs450 per tola and Rs386 per 10 grams to settle at Rs151,550 and Rs129,930, respectively.

Pakistan is a small market for gold at the global level. It meets the commodity’s demand through imports as it does not produce the precious metal locally.

Accordingly, the gold price for local markets is determined by keeping in view its prices in world markets, rupee-dollar exchange rate, and demand and supply in domestic markets. 

The latest price for local markets was determined to keep in view the prices at which trade took place among buyers and sellers.

In the international market, the price of the yellow metal rose by $2 per ounce settling at $1,655 as the dollar weakened, but they held to a tight range with investors reluctant to place big bets before the US Federal Reserve’s rate decision later in the day.

The Fed is due to release its policy statement at 2pm EDT (1800 GMT) and is widely expected to raise its benchmark overnight interest rate by 75 basis points, the fourth such increase in a row.

Traders will be looking out for the Fed’s commentary on future rate hikes amid growing optimism that the US central bank will slow rate increases from December.

Should the Fed pivot narrative be vindicated this week, then spot gold would have a high chance of touching $1,700 over the immediate term.

Gold bulls’ shoulders would slump if the Fed quashes the notion that policymakers are letting up in their ongoing battle against inflation.

The precious commodity’s rates in Pakistan are around Rs1,500 below the cost compared to the rate in the Dubai market.

Meanwhile, silver prices in the domestic market remained unchanged at Rs1,590 per tola and Rs1,363.13 per 10 grams.

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Pakistan Desires a Sturdy, Long-Term Alliance With Huawei: PM

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According to Prime Minister Muhammad Shehbaz Sharif, the government’s primary objective is to give Pakistani youth technical training in the field of information technology.

The prime minister expressed his desire for a strong and long-term collaboration with Huawei in an interview with a five-member delegation that visited him in Islamabad and was led by Huawei CEO Ethan Sun.

He said the Huawei’s ICT training program will not only increase it exports but will also help youth in getting job opportunities.

The meeting was briefed on the progress made in providing training in the it sector to 300,000 pakistani youth organized by Huawei.

Out of 300,000 youth, 240,000 youth will be provided basic training while 60,000 youth will be provided high-tech training.

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The IMF allows Pakistan to lower electricity tariffs.\

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7 hours ago

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The International Monetary Fund (IMF) has permitted the Pakistani government to decrease the energy cost by one rupee.

The alleviation will be incorporated into the base tariff for electrical units, with funding sourced from revenue collected by the levy on captive power plants. A tax has been enacted on the utilization of gas by captive power plants.

The government is developing a relief plan for electricity consumers, which will be announced upon clearance from the international lender.

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Robust purchasing sustains PSX’s positive trend

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On Thursday, bullish momentum continued in the Pakistan Stock Exchange (PSX), with the benchmark KSE-100 index reaching 118,806 after an increase of over 300 points.

Across the board buying was observed in key sectors, including commercial banks, fertiliser, power generation, and oil and gas exploration companies.

Aside from that, index-heavy equities such as MARI, POL, HBL, MCB, UBL, KOHC, and LUCK experienced gains, capitalizing on the prevailing bullish atmosphere in the market.

Market analysts attribute the recent bullish trend in the PSX to a staff-level agreement between the International Monetary Fund (IMF) and Pakistani authorities following the initial review under Pakistan’s Extended Fund Facility (EFF) and a new arrangement under the Resilience and Sustainability Facility (RSF).

Furthermore, a recent study done by the Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL) regarding the feasibility of the Reko Diq project in Balochistan has also conveyed favorable indications to investors.

The bulls surged rapidly after the staff-level deal with the global lender, with the KSE-100 Index reaching a peak of 118,220 before closing at 117,178 points, reflecting an advance of 1,139 points on Wednesday.

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