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Online Gold Trading
السلام عليكم!
I have asked different questions in the past one year regarding online trading of gold on this platform, I was told that it is permissible and all my questions were well answered. I thank the whole team of Ask Ghamidi for that.
But, now I have one more question regarding this and that is:
As we know that gold is always traded online in pair, which is Gold & USD denoted by XAUUSD, therefore, my question is that this pair has both USD & Gold, which means that the fluctuations in USD price and gold price has a direct effect on this pair. The question I’m trying to ask is that interest on USD in international market plays a vital role in the price of USD, therefore, if we trade this pair and the interest rate on USD increases the value of USD increases which decreases the value of gold as they both are indirectly proportional to each other and vice versa. So, if I sell a lot of this pair I would now want that the USD value should increase so that the gold value gets decreased and I can earn profit from this trade, which means that the interest being one of the factors that influence the value of USD should be increased in order to increase the value USD in the market and ultimately decreasing the value of gold due to their indirect proportionality. Now what I earned if not all then some portion of my earnings is due to the increase of interest rate on USD, so will this earnings be halal as it was earned due to the influence of interest rates on USD?
Thanks a lot.
جَزَاكَ ٱللَّٰهُ خَيْراً کثیراً.
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1 Reply
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Online Gold Trading
updated 10 months, 4 weeks ago
2 Members
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1
Reply
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As historically gold was considered a currency, it is still traded on the foreign exchange (Forex) under symbols like XAUUSD, even though it is no longer considered a currency. If you strictly want to trade gold without pairing it with USD, you can always trade ETF’s like GLD and IAU.
With that said, religiously you are not responsible for the international monetary system and how interest affects values or prices of currencies or commodities. For us riba has been deemed haram and it is only a consideration in loan transactions. Since trading gold is a business transaction and not a loan transaction, there is no harm in trading gold on the Forex.
For details about riba, please see:
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