The per tola price of gold increased by Rs750 to reach Rs123,500, according to gold rates shared by the All Sindh Saraf Jewelers Association (ASSJA).
Gold prices reached an all-time high on Monday, taking a big jump of Rs5,100 from the previous working day to reach Rs123,800.
The price fluctuated during the week but has now again come in close proximity to its all-time high. The price of gold in international markets has also been on the rise as the per ounce price of gold has increased by $21 to $1,975.
The price of gold has been on the rise ever since the rise in COVID-19 cases, especially in the US, and experts believe the prices of gold will continue to rise until COVID-19 cases peak.
The US economy has contracted at its steepest pace since the Great Depression in the second quarter as the COVID-19 pandemic shattered consumer and business spending, and a nascent recovery is under threat from a resurgence in new cases.
Meanwhile, Rashid Ali, head of business development at HG Markets, says the reason behind this recent hike in gold prices is due to the US-China trade war as well as aggravating diplomatic ties between the superpowers. Both countries also ordered the closure of each other’s consulates in Houston and Chengdu amid allegations of espionage last week.
The flock of investors to the safe-haven yellow metal has been boosted by a weak dollar, which fell to its lowest level in over a year, and hopes that the Federal Reserve will keep a policy that helps the economy recover from the impact of the COVID-19 pandemic. The bullion is considered a safe and secure place to invest, especially during times of crisis.
Meanwhile, Rays Commodities COO Adnan Agar says the reason gold prices have been increasing and broke all-time records is because of fears of a second wave of the coronavirus as cases increase in some countries.
The uneasy US elections later in the year have also been increasing investors’ anxiety and these uncertain times have been pushing them towards secure investments such as gold. Agar thinks the tension in US-China relations was due to the upcoming US elections.
Meanwhile, negligible interest rates in major countries have also made gold more attractive to investors as they will not be getting much by putting their money in government securities.