The price of 24-karat gold in Pakistan increased by Rs.700 per tola on Thursday, bringing the selling price to Rs.277,900 compared to Rs.277,200 on the previous trading day. Similarly, the price of 10 grams of 24-karat gold rose by Rs.600, reaching Rs.238,254 from Rs.237,654. Additionally, 10-gram 22-karat gold increased to Rs.218,400 from Rs.217,850, as reported by the All Sindh Sarafa Jewellers Association.
The price of silver remained stable, with per tola silver selling for Rs.3,050 and 10 grams for Rs.2,614.88.
International Gold Market Hits Record High
In the international market, the price of gold increased by $7, reaching $2,682 from $2,675. Gold briefly touched a new record high of $2,689 earlier in the European session before pulling back after the release of stronger-than-expected US Retail Sales data, which strengthened the US dollar. Gold is negatively correlated with the USD, and the dollar’s rise contributed to the slight dip in gold prices.
Factors Driving Gold’s Rally
- Central Bank Policies: Global expectations of lower interest rates have contributed to gold’s recent rally. As inflation rates fall faster than anticipated, major central banks—including the Bank of England, Bank of Canada, and European Central Bank—are expected to lower interest rates, making gold a more attractive investment due to its non-interest-bearing nature.
- Safe-Haven Flows: Heightened tensions in the Middle East have spurred demand for gold as a safe-haven asset, further supporting its price increase.
- US Economic Data: Despite the bullish trends, US Retail Sales data for September showed stronger-than-expected growth, rising by 0.4% month-over-month compared to the 0.1% growth in August. This data put pressure on gold as it strengthened the USD, which typically inversely affects gold prices.
Technical Analysis: More Upside Expected for Gold
Gold’s recent surge confirms an ongoing uptrend, with analysts predicting further gains. After hitting a record high, a temporary pullback is expected, potentially bringing the price down to the $2,670 or $2,650 range. However, with momentum on its side, gold is likely to resume its upward trajectory, possibly reaching the next psychological level of $2,700.
The Relative Strength Index (RSI) indicates there is still room for growth, as it remains below overbought territory. Therefore, more upside is expected in the near future.
Outlook
Gold’s continued rally is supported by declining global interest rates, central bank policies, and geopolitical tensions. Investors are advised to monitor US economic data, as any unexpected strength in the US dollar could impact gold’s upward momentum. However, the long-term outlook remains positive, with gold likely to test new highs in the coming weeks.
