Gold price jumps to new peak
KARACHI – Gold prices climbed more than 2 percent on Monday to their highest level since February 2013, as spikes in coronavirus cases in several countries outside China deepened worries about a hit to the global economic growth.
In Pakistan, local bullion price of one tola gold on Monday rose to all-time high of Rs96,300, showing a sharp jump of Rs2,000. This is the fourth time this year that domestic gold prices have broken previous records on the back of soaring international prices.
Experts have opined that the country’s gold sector has been attracting investment, a private television channel reported Monday.
Spot gold was up 1.6 percent at $1,669.80 per ounce by 0713 GMT, after climbing to $1,678.58 earlier in the session. U.S. gold futures rose 1.5pc to $1,672.80.
“The thinking is that fewer people are holding shares, selling down in particular, and that money has to fall into havens,” said Michael McCarthy, chief market strategist at CMC Market.
“The impact on the global economy also means we will likely see a lower interest rate environment for longer.”
Lower interest rates reduce the opportunity cost of holding non-yielding bullion. Global equities extended losses as concerns about the spread of the virus beyond China grew with sharp rises in infections in Italy and Iran, while South Korea raised its infectious disease alert to its highest level. The World Health Organization (WHO) said it is worried about the growing number of cases without any clear link to China.
Article source: https://nation.com.pk/25-Feb-2020/gold-price-jumps-to-new-peak