Gold prices fall by Rs 3,000 to Rs 53,500/tola

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KARACHI: The prices of yellow metal in the country fell by Rs 3,000 per tola to Rs 53,500 per tola on Monday, bringing the total monthly decline to Rs 7,500 per tola. On back of weak rupee agaisnt dollar the leading investors were selling gold to buy greenback, said Saleem Ahmad, a meta expert in London.
The yellow metal price in the international market also witnessed a dip as it dropped by $100 an ounce to stay at $1,400 an ounce. The 10 grammes gold prices dipped by Rs 2,565 to Rs 45,863 per 10 grammes on Monday.

With the rising demand of dollar in domestic market investors are inclined to buy US paper money besides reports of US share market improvement has also put some pressure on gold prices globally, he added.

Ahmad said the gold being the safest haven for investment remained in focus despite the fact that its prices were on correction.
The announcement of Cyprus that it would sell some of its gold reserves in the international market has also put some negative impact on the yellow metalís prices. Besides high returns on investment and hedging became the driving force behind the low prices of gold in the global markets. The institutional and hedge fund buying improved on low prices of gold besides physical buying in major countries also witnessed a downward trend.
The yellow metal will still be in the eyes of leading buyers and hedge masters around the globe including leading major gold investors in Pakistan, he added.
Hedging in gold is still on the higher side as it touched around 12 percent in three months of 2013.
The domestic sale of yellow metal registered a decline of around 55 percent in three months of 2013, though the demand was still there on wedding season but the customers curtailed volume of buying.

Meanwhile, the gold importers demanded of the government to announce duty cut on import of the commodity.
The government should announce around Rs 100 per tola duty cut in order to lower its prices in the domestic market besides providing relief to exporters of gold ornaments in the international market.

Currently the duty on import is around Rs 550 per tola and due to higher dollar value against the rupee, the local demand for the commodity is declining.
The government should provide duty relief on three kilogrammes (kgs) imports of gold on every 10 kgs of jewellery exports. Gold hit an all-time high of $1,920.30 an ounce in September last year.

Courtesy: Daily Times

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