The price of gold in the country saw a rise of Rs 1,500 per tola on Monday due to increasing geopolitical tensions in international markets. According to data from the Karachi Sarafa Association, the price for one tola of 24-karat gold increased to Rs 215,400 from Rs 213,900, while the price for 10 grams of 24-karat gold rose to Rs 184,671 from Rs 183,385. Similarly, the price for 10 grams of 22-karat gold increased to Rs 169,282 from Rs 168,103.
This increase in gold prices comes as a result of mounting geopolitical tensions, particularly following a drone attack on US bases near northeastern Jordan, which has impacted market sentiment and driven up demand for bullion. Additionally, a moderate increase in US Core Personal Consumption Expenditures (PCE) data for December has softened the inflation outlook, further boosting the appeal of gold.
In the international market, gold futures were available at $2,029.50 per ounce, with an uptick of $10.70, influenced by both the strengthening of the US dollar and predominant buyers. From a technical perspective, the gold price could continue to attract sellers beyond the 50-day SMA hurdle, with potential for further increase towards the $2,100 mark. However, there is also support near the $2,012-2,010 area, and a drop below this level could trigger further selling pressure.
Additional Insight:
The rise in gold prices in the country is reflective of the traditional role of gold as a safe-haven asset during times of geopolitical uncertainty and market volatility. As tensions escalate in certain parts of the world, investors often turn to gold as a means of protecting their wealth. In addition to geopolitical tensions, the outlook for inflation and the actions of central banks, such as the Federal Reserve in the US, also have a significant impact on gold prices. As such, understanding the broader economic and geopolitical context is crucial for predicting the future movement of gold prices.
