Gold hits fresh peak of Rs31,900 By Aamir Shafaat Khan

[LahoreEstate]

Wednesday, 07 Oct, 2009

KARACHI: The local gold price on Tuesday hit an all-time high of Rs31,900 per tola, from Rs31,250 on Monday, after the yellow metal soared to $1,036 per ounce on the London bullion market from $1,005.

The 10 gram rate of gold (24ct) jumped to Rs27,342 from Rs26,785. The rate of one tola gold on September 3 was Rs30,000.

Gold dealers representing two different associations gave conflicting claims regarding jewellery sales amid ongoing peak marriage season. All Pakistan Gem Merchants and Jewellers Association (APGMJA) Chairman Saeed Mazhar Ali claimed that sales were going normal and the presence of buyers had picked up slightly as families were out to arrange gold sets for their daughters.

He added that people were also investing in gold after persistent rising trend in its prices. He linked the price surge of yellow metal in world markets to weakening of the dollar against the euro and high bullion buying by India on the eve of Diwali celebrations.

On the contrary, President All Karachi Saraf and Jewellers Group Haji Haroon Rashid Chand said that sales had been laggard despite peak marriage season. He claimed that gold was selling under cost by Rs500 per tola in the local markets as compared to Dubai.

According to figures of Federal Bureau of Statistics (FBS), gold imports during July-August 2009 went up by 7.38 per cent in quantity and 5.36 per cent in value. Around 262 kg of gold (worth $8 million) were imported during the period under review as compared to 244 kg ($7.5 million) in the same period of 2008.

However, export of jewellery had also registered a massive increase to $136 million during July-August as compared to $42 million in the corresponding period of 2008.

Both the associations said that official duty paid gold imports had been nil for the last over two years after increase in withholding tax from one to two per cent besides 50 cents per tola duty. Official taxes now come to Rs600 per tola as compared to Rs160 per tola, which has encouraged smuggling.

There is no import duty on gold if imports are made for export of jewellery after value addition. As per the government’s policy, any quantity exported in the form of gold jewellery has to be imported in the form of yellow metal within seven months.

http://www.dawn.com/wps/wcm/connect/dawn...00--szh-06