Gold Price Pakistan market today: the price of 24-karat gold in Pakistan experienced a significant drop, plummeting by Rs2,000 per tola to reach Rs215,300.
10-gram 24-karat gold is currently selling for Rs184,585, a decrease of Rs1,715. 10-gram 22-karat gold is currently selling for Rs169,203, down from yesterday’s price of Rs170,775.
Silver prices have also seen a decline in the domestic market. The 24-karat silver is currently being sold at Rs2,600 per tola and Rs2,229.08 per 10-gram, showing a drop of Rs50 per tola and Rs42.86 per 10-gram.
GOLD INTERNATIONAL MARKET
The decline in commodity prices is attributed to central bankers’ strong resistance against market expectations for interest rate cuts, intensifying a global selloff in both stocks and bonds, as reported by Bloomberg.
European Central Bank President Christine Lagarde and Governing Council member Klaas Knot cautioned on Wednesday that aggressive bets on interest-rate cuts are not aiding policymakers in the battle against inflation. Federal Reserve Governor Christopher Waller echoed this sentiment on Tuesday, urging caution on the pace of easing.
Market indicators show a decrease in the probability of a Fed rate cut in March, dropping from 80% on Friday to around 65%. Money markets have also shifted expectations for the timing of the ECB’s first quarter-point cut to June, moving it from April.
Last week marked the second consecutive week of decline for 24-karat gold prices in Pakistan. Investors and market observers are closely monitoring these shifts amid global economic uncertainties.
XAUUSD
XAUUSD posted an intraday high of $2033.72 and intraday low of $2017.69. Gold is currently trading at $2025.50 (4:08pm Wednesday, 17 January 2024 (GMT+5) Time in Pakistan).
GOLD PRICE FALLS AMID FED WALLER’S STANCE
The price of gold (XAU/USD) experienced a sharp decline as Federal Reserve (Fed) Governor Christopher Waller maintained a narrative favoring higher interest rates for a longer period. The hawkish commentary from Waller has raised doubts about the possibility of a rate cut by the central bank in the upcoming March meeting, contrary to market expectations.
US INFLATION PROVES STUBBORN IN LATEST DATA
The last leg of high US inflation has proven to be significantly stubborn, challenging Fed policymakers. The Consumer Price Index (CPI) data for December indicates persistent high price pressures, likely attributed to steady labor market conditions and robust consumer spending momentum.
MARKET DIGEST: GOLD PRICE DECLINE AHEAD OF US RETAIL SALES DATA
Investors are closely monitoring the performance of the US Dollar, Treasury yields, and bullion prices ahead of the United States Retail Sales and Industrial Production data for December. The uncertainty about the Federal Reserve’s stance on interest rate cuts has further strengthened the downside bias to the gold price.
HAWKISH FED COMMENTARY SPARKS UNCERTAINTY
Fed Governor Christopher Waller’s comments suggest that rushing into rate cuts could lead to inflationary pressures, potentially hindering efforts to achieve price stability. Waller emphasizes a methodical and careful approach to rate cuts, considering the resilience in the US economy that might delay potential reductions in borrowing costs.
GOLD PRICE TECHNICAL ANALYSIS: DOWNWARD TREND CONTINUES
Following Waller’s hawkish remarks, gold price has extended its losses, nearing $2,017. The downside bias is reinforced as the price falls below the 20-day Exponential Moving Average (EMA) and finds interim support near the 50-day EMA, around $2,017.
The 14-period Relative Strength Index (RSI) is declining towards 40.00, indicating potential bearish momentum if a breakdown occurs below this level.
The decline in the chances of a rate cut by the Fed in March, as reflected in the CME Fedwatch tool, coupled with a rise in the US Dollar Index (DXY), has contributed to the continued drop in gold prices. Investors are awaiting key economic data, including Retail Sales and Industrial Production, along with insights from Fed speakers, to navigate the evolving market dynamics.
