Hoarding Gold is a centuries old reaction at the time of crisis. This yellow metal soared its value at the critical times because traditionally it is considered as safe havens.
The situation repeated when the brexit resulted in global markets crashing down with the Pound Sterling and Euro taking a hefty bump.Contrarily safe harbors like gold grooved on to nth degree. The gold prices raised by 3% overnight as Britain decided to leave European Union. Sterling suffered a great day drop of 10% over dollar and investors turning towards safe havens like gold which boosted gold rates up to 5.3%.
Gold Prices in Pakistan by virtue of ASSJA
According to ASSJA gold prices in Pakistan by Rs 1500 moving to Rs 50,200 per tola. The president of ASSJA expects that gold prices in Pakistan will continue to rise in the upcoming weeks because sterling is losing its value and investors will switch to Gold to avoid the volatility in the currency market. In the next few months Gold Prices Will be more strengthened.
Statistics Stated by World Gold Council
The statistics released on global gold demand by World Gold Council (WGC) showed a constant burgeon in Pakistan’s consumer demand for the first three months of 2016. The gold demand raised from 8.4 tonnes to 9.4tonnes showing an increase of 12%.
The Gold demand is segregated in two categories
- Gold Jewelry
- Gold Bars and Coins
According to WCG the gold demand for the two categories in the first quarter of 2016 Jan-March was 13.2% and 9.6% respectively.
Pakistan’s Share in International Gold Market
The International Gold consumer demand comprises of 735.8 tonnes for the first quarter of 2016. Pakistan has a pint-sized share of 1.3%. It is quite obvious from the above mentioned figures that the proportion is quite miniscule so Gold Prices in Pakistan are directly in line with the global trends.
Endangered U.S. Economy
The uncertainty induced by brexit affected the U.S.economy, gold market, depressed the consumer spending, business investments and shaken the economic growth. U.S. is the single largest investor in UK and any American firms consider it a toran to free trade with EU. Brexit has endangered the U.S. business investments. 7 forecast for the year 2016 by 0.2%. The slow tread of economic growth and high odds of recession increases the gold prices in USA.This shiny metal is at a bull run and responding stronger towards U.S. developments.
Impact of Brexit on U.S. Gold Market
In the time of global chaos, gold is considered as safe haven against European or any other global crisis and Gold has vertibly acted strongly. Gold prices in USA have seen huge acquisitions in the year 2016 among volatile markets and general fore-bode behaviour about the global economy. It is estimated that golf prices in USA have gained 20% raise at the start of the year and by now it has become one of the most well-paying asset of the year.
According to Karim Merchant ,CEO of Pure Gold Merchants Gold Prices in USA benefited the most from brexit and investors are running towards this precious metal. There are certain indications that Gold prices in USA could continue to trade higher and touch the level of $1450 by the end of this year.