Gold prices jump 21% in four months, expected to rise further
After remaining subdued for a year, gold prices have surged 21% so far this year, pushed by international factors.
The price of 1gm of 24-carat gold in local market jumped from QR131 on January 1 to QR157 at April-end, and the price of 1gm of 22-carat gold from QR122 to QR148.
The sharp rise in the prices have impacted consumers.
“Broadly, we’ve seen two types of customers. One set has decided to postpone buying gold and are waiting for the prices to fall. The other set is buying gold thinking that it is better to buy now as the prices may rise further in future,” said the sales manager of a jewelry showroom in Doha.
“Gold prices in Qatar are determined by the international market,” he added.
The prices in the local market move in tandem with global prices because the prices here are linked to international market, mainly the London bullion market.
Gold has seen a steady rise in the past four months. It began the upward journey in January with the price of 22-carat gold touching QR128.50 per gram in the first month. It reached a high of QR142 in February, QR145 in March and QR148 in April.
“Multitude of factors, including relatively dovish US Federal Reserve policy statement, surprising status quo by BoJ (Bank of Japan) on monetary policy and weak US macroeconomic numbers translated in to sharp weakness in US dollar and in the process aided the ascent in the precious metals, including gold,” Hitesh Jain, Head, Alternate Research, IIFL, a Mumbai-headquartered brokerage firm, told The Peninsula.
Weakness in the global economy, US Federal Reserve’s decision not to hike interest rates in its recent meeting and negative interest rates in many countries such as Japan have pushed up gold prices in the recent months. The gold price trend is highly dependent on the US Federal Reserve interest rate hike decision.
Increase in these rates strengthen the dollar, prompting more fund outflows from gold and other commodities to the dollar.
Experts expect gold prices to move upward in current year as global factors affecting the yellow metal are not likely to see sudden change in the short term.
Courtesy: thepeninsulaqatar.com
