In a striking development, gold price in Pakistan surged by Rs6,600 per tola on Wednesday, following a strong upward trend in the international bullion market. The sharp spike comes as global gold prices hit a one-week high, driven by a weaker US dollar and intensified safe-haven demand due to growing global economic and geopolitical uncertainty.
Global Factors Behind the Surge in Gold Prices
Gold prices have been on an upward trajectory globally, rising for the third consecutive session. Spot gold jumped by 0.7% to reach $3,312.51 an ounce, while US gold futures rose 0.9% to $3,315.60. This surge is largely attributed to a declining US dollar, which fell by 0.6% against a basket of major currencies. A softer dollar makes gold more affordable for international buyers, thus increasing demand and driving prices higher.
Investors are turning to gold as a safe-haven asset, particularly amid uncertainty surrounding economic indicators and ongoing geopolitical tensions. Market experts highlight that fears over global debt, inflation, and a volatile stock market are causing investors to flock to precious metals as a hedge.
Domestic Impact: Gold Price in Pakistan Hits Rs349,400 per Tola
Locally, the impact of the international rally was immediate and significant. According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), gold price in Pakistan increased by Rs6,600 per tola, bringing the new rate to Rs349,400. Similarly, the rate for 10 grams of gold jumped by Rs5,659 to settle at Rs299,554.
This notable rise follows a relatively modest increase of Rs300 per tola just a day earlier, when gold stood at Rs342,800. The latest jump underscores the volatility in the market, closely tied to movements in global bullion prices.
Expert Analysis: What’s Next for Gold Prices?
Adnan Agar, Director at Interactive Commodities, offered insights into the future outlook. He noted that gold is currently hovering near critical resistance at $3,350 in the international market. “If prices manage to break above this level, we could see an extended rally pushing gold towards $3,380 or even $3,420,” he said.
However, Agar warned that if the resistance holds, a correction could pull prices back to $3,280 or possibly $3,270. He also mentioned that market activity has been subdued, lacking the strong momentum seen in earlier sessions. The upcoming US bank holiday could also lead to thinner trading volumes, which might influence short-term price movements.
Currency Update: Rupee Slightly Weaker Against the Dollar
Meanwhile, the Pakistani rupee showed a slight decline against the US dollar in the interbank market, closing at 281.97 – down by five paisas from the previous close of 281.92. This marks a minor depreciation of 0.02%.
According to data from Ismail Iqbal Securities, the rupee has depreciated by 1.21% since the beginning of the calendar year (CYTD) and by 1.29% since the start of the fiscal year (FYTD). The weakening currency may further influence the domestic price of gold, especially when combined with international market dynamics.
Conclusion: What It Means for Investors and Consumers
The recent rise in gold price in Pakistan signals a critical point for both investors and everyday consumers. While some see it as a golden opportunity for short-term gains, others—particularly those looking to buy gold for weddings or savings—may face higher costs.
With global uncertainty likely to continue influencing bullion markets, keeping an eye on international developments and local currency trends will be crucial for anyone involved in gold trading or investment.