Gold price rises to Rs226,000 per tola

ISLAMABAD: Gold price regained some positive traction on Monday and surged 0.12 percent.
As of 1340 hours GMT, the gold futures were available at $2,020 per ounce, showing an increase of $2.40 (-0.12 percent). Out of the $2.40 per ounce increase, +$3.4 was due to weakening of the US dollar and -$1 was due to predominant sellers, according to Kitco Gold Index.
The gold rate in Pakistan for a single tola of 24-karat reached Rs226,000 while for 22-karat, it was recorded at Rs 207,200 per tola. Similarly, the gold rate in the country for 10 grams of 24-karat reached Rs193,800 while for 22-karat, it was recorded at Rs 177,650.
The gold rate has been on a steady uptrend in Pakistan due to massive depreciation of the rupee against the US dollar for the past one year. During such times, people prefer to buy yellow metal to protect themselves against inflation and currency depreciation.
Gold price has gone into a consolidation phase as the benchmark 10-year US Treasury bond yield edged higher towards 3.5 percent, limiting gold’s upside. However, the modest US dollar’s weakness lent support to gold prices. The dollar edged lower for the second successive day internationally. The gold price is inversely proportional to US treasury bond yields, which surged on Friday and rising yields stopped gold prices going forward. A sharp intraday rise in the US government bond yields turned out to be a key factor driving flows away from the non-yielding gold prices.
From a technical perspective, any subsequent move up is likely to confront some resistance near the $2,030 region ahead of the $2,040 supply zone. On the flip side, the daily swing low, around the $2,015 area, might now protect the immediate downside. This is followed by the $2,000 psychological mark. A convincing break below the latter might prompt some technical selling. – TLTP