Surge In Gold Demand

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    Gold demand surges by 38pc

    By Our Staff Reporter

    KARACHI, May 17: Pakistan's gold demand in first quarter (January-March) 2002 was estimated at 41 tons - 38 per cent higher as compared to same period of 2001.

    Inflows of foreign aid following the September 11 incident continued to boost income and spending, underpinning gold purchases, says a press release of the World Gold Council (WGC).

    The rise in the price of gold in early February caused a four-day suspension in imports, but the establishment of a higher level for the Pakistani rupee following its appreciation during fourth quarter of 2001, cushioned the impact of the increase.

    The WGC said the increase in overall demand was also strongly supported by the wedding season before the start of Muharram. It may be mentioned here that the gold dealers in Pakistan have been continuously portraying a dismal picture of gold demand and its sales, saying the demand has been at the low ebb.

    "People are finding it difficult to meet their regular demand of kitchen items and cannot afford to pile up gold," a gold dealer said.

    According to the WGC, gold demand remained strong in a number of countries where economic circumstances were more propitious. The council cited Pakistan as a most noticeable example where consumption rose by 38 per cent. Other countries, where gold demand surges, were China by five per cent, South Korea seven per cent, Malaysia eight per cent, Vietnam 11 per cent and the UK by three per cent. Demand also increased on year on year by two per cent in the US.

    Gold demand fell in the Middle East by nine per cent due to political worries and Thailand by 25 per cent.

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