Local gold (24 karat) prices soared to a new high of Rs. 90,000 per tola on Thursday after it saw an increase of Rs. 900 from its last closing of Rs 89,100 on Wednesday. The increase was witnessed after the metal hit a six-year high in the international market.
In the international market, price of the precious metal surged $15 per ounce (31.10 grams) to the six-year high at $1,545 in the London market on Wednesday.
The US-China trade war went from bad to worse to an unprecedented level with a tit-for-tat escalation of imposing tariffs from both sides. The investors retreated to the safe haven provided by the precious metal. Overall, there was a considerable increase of buying in bullion seen across the world.
The price of 10 gram gold also witnessed an increase of Rs. 770 and was last traded at Rs. 77,160 as compared with a closing of Rs. 76,390 on the previous day. The price of silver remained stable and was traded at Rs. 1130 per tola whereas 10 gram silver was last traded at Rs. 968.80.
According to the dealers, the increase in the bullion price had further slowed down sales of gold and its ornaments in the country because the purchasing power of the common man is squeezing day by day.
“The overall demand for the commodity has dropped to 2,000-3,000 tola per day in the country compared to around 10,000 tola a few years ago.” said the Association President Haroon Chand
The dealers were of the view that bullion might test new highs in the domestic and international markets in the days and weeks to come. Fundamentals are very strong for gold with heightened trade tensions between the US and China.