The year 2020, so far, has been a good year for gold as rates of the precious yellow metal touched record high numbers in Pakistan on Friday, recording the highest weekly gain globally after 2008.
As of March 28, 2020, the precious metal is trading over Rs 100,700 per tola in the local Pakistani markets. The rate of 10gm per gold is Rs 86,300.
This development comes amid a hike in gold rates in the global markets where gold rates reached a rate of $1,623 per ounce.
According to the Pakistan Bureau of Statistics, the government imported 4% or $351,000 of more gold to $10.1 million during July-January 2019-20 from $ 9.71 million during July-January 2018-19.
The total import volume of gold in Pakistan has decreased by 3% to 240 kg in July-January 2019-20 from 248 kilograms in July-January 2018-19.
COVID-19 outbreak rattles gold prices
One of the biggest reasons for the global hike in gold rates is as the US has now become the new epicenter for the COVID-19 outbreak. The global superpower has surpassed China and Italy with nearly 104,000 confirmed cases.
So far this week, gold has increased by more than 8%. This is supported by the biggest-ever hike in the US weekly jobless claims and also due to the US Federal Reserve’s unprecedented measures for economic stimulus.
Investors now await a $2.2 trillion stimulus package bill that would pump money into the world’s biggest economy to mitigate the financial damage caused by the virus.
Standard Chartered Bank analyst Suki Cooper said in a note, “The market is looking to assess the impact of numerous lockdowns and business closures on the economy. Gold prices have gained further ground in anticipation of further stimulus and weaker data to come. Price risks remain to the upside barring profit-taking and (we) expect prices to average $1,725 per ounce in Q2-2020.”
Participants of the gold market also closely observed the physical supply as virus-led lockdowns have stalled global supply chains.
Dealers of physical gold have also struggled to fulfill the increase in gold demand this week. This was evident in Singapore where COVID-19 rattled global supply chains. Moreover, massive discounts were provided in India after a national lockdown.
Among other precious metals, Platinum remained stable at $736.08 per ounce globally. But it has gained nearly 22% this week. Palladium was down by 3% at $2,262 per ounce. However, it has increased by around 39% so far this week.
Silver was also heading to its largest weekly gain since 2008 but it fell by 0.3% to $14.38 per ounce.
What do you think of the story? Tell us in the comments section below.