24-KARAT GOLD SURGES BY RS2,800, HITS RS237,600 PER TOLA

Gold price (XAU/USD) continues its bullish streak, trading near a fresh all-time high of approximately $2,260 as investors brace for a bustling week in the United States’ economic calendar. The precious metal maintains its gains amidst mounting expectations for the Federal Reserve (Fed) to consider interest rate cuts in the upcoming June meeting. Fed Chair Jerome Powell’s acknowledgment of the decline in February’s core Personal Consumption Expenditures inflation (PCE) data further bolsters the case for easing monetary policy, as the Fed seeks evidence of price pressures alleviating towards the 2% target.

The anticipation of Fed rate cuts, following a two-year period of rate hikes, has tempered yields on interest-bearing assets like US bonds. This dynamic has concurrently boosted the investment appeal of Gold. Although 10-year US Treasury yields saw a slight uptick in Monday’s European session, they have since retreated to 4.20%.

Meanwhile, the US Dollar Index (DXY), tracking the greenback against six major currencies, stabilizes around the 104.50 mark. The upside potential for the US Dollar remains constrained by firm expectations of Fed rate cuts. Nevertheless, uncertainty looms ahead of the release of the United States Nonfarm Payrolls (NFP) report and related labor data, which is tempering downward pressure on the currency.

In a historic move, Gold price has surged to a record high of $2,265, reinforcing its upward trajectory after surpassing the previous lifetime high of $2,223 set on March 21. With the precious metal trading in uncharted territory, the possibility of further upside remains. Notably, all short-to-long term Exponential Moving Averages (EMAs) are trending higher, underscoring robust near-term demand.

The 14-period Relative Strength Index (RSI) has reached 78.00, indicating vigorous upside momentum, albeit residing in overbought territory. While signs of divergence are currently absent, the potential for an overbought signal cannot be discounted.

GOLD PAKISTAN

The domestic bullion market continued its upward trajectory on Monday, with 24-karat gold witnessing a significant gain of Rs2,800 to reach Rs237,600 per tola. This surge follows a notable increase of Rs19,100 in March and Rs3,800 last Friday.

According to the latest report from the Karachi Sarafa Association, the price of 24-karat gold soared to Rs203,704 per 10-gram, marking an increase of Rs2,401 compared to the previous session. Similarly, the price of 22-karat gold was quoted at Rs186,728 per 10-gram.

Meanwhile, silver prices remained stable, with 24-karat silver being traded at Rs2,600 per tola and Rs2,211.93 per 10-gram.

Globally, spot gold reached record highs amidst subdued US inflation data. Bullion surged to $2,258.77 an ounce on Monday, marking a 1.3% increase from Thursday’s close and reflecting a year-to-date increase of 9.42%.

The US core personal consumption expenditures (PCE) index showed a cooling trend in February, with a month-on-month increase of 0.3% and a year-on-year increase of 2.8%.

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