Gold Prices Drop Sharply in Pakistan Following Global Decline

Gold prices continued their downward trend on Thursday, marking a significant fall both internationally and domestically. The drop has come as a surprise to many investors and jewelry buyers who had been closely monitoring global market movements. The price of 10 grams of gold decreased by Rs3,100, bringing it down to Rs371,966, while the price of gold per tola fell by Rs3,500, settling at Rs433,862.

Global Gold Market Faces Pressure

In the international bullion market, gold prices fell by $35 per ounce, reaching $4,115 per ounce. This sudden decline has been attributed to several global factors, primarily the strengthening of the US dollar and ongoing uncertainty surrounding economic data from the United States.

According to market experts, investors are now shifting focus to the upcoming US inflation report and the Federal Reserve’s monetary policy decision, both of which could impact gold prices further. A stronger dollar often leads to lower gold prices because it makes the metal more expensive for foreign buyers.

Local Market Mirrors Global Trend

The local gold market in Pakistan is closely tied to international rates, and any change in global prices directly impacts domestic rates. The All-Pakistan Gems and Jewellers Sarafa Association (APGJSA) reported that on Wednesday, gold had already dropped by Rs7,538 per tola, falling from Rs444,900 to Rs437,362. Similarly, 10 grams of gold fell by Rs6,463, settling at Rs374,967.

The association noted that Thursday’s decline only added to the downward pressure, bringing gold to its lowest level in weeks. Traders say the continued depreciation in prices is mainly due to profit-taking by investors and the anticipation of key US inflation data.

Why Gold Prices Are Falling

Analysts believe there are multiple reasons behind the current slump in gold prices. Globally, gold has been under pressure due to:

1. A stronger US dollar – making gold less attractive for foreign investors.
2. Rising US bond yields – as investors move toward interest-bearing assets.
3. Profit-taking – after gold reached multi-week highs earlier this month.
4. Uncertainty around inflation and monetary policy – causing cautious investor behavior.

In Pakistan, the situation is worsened by the rupee’s relative stability against the US dollar, which limits the local price of gold from rising even when international prices fluctuate.

Impact on Local Investors and Buyers

The drop in gold prices has created mixed feelings in the local market. Investors, who often consider gold a safe haven, are facing short-term losses, while jewelry buyers are welcoming the dip as a rare opportunity to purchase gold at lower rates.

Gold shop owners in Karachi and Lahore reported an increase in customer interest following the recent decline. Many buyers are taking advantage of the reduced prices ahead of the wedding season, traditionally a time of high gold demand in Pakistan.

However, traders remain cautious. “If the global market continues to face pressure due to inflation data or interest rate changes, we might see further declines,” one Karachi-based jeweler told local media.

Outlook for Gold Prices in Pakistan

Market watchers expect gold prices to remain volatile in the coming weeks. Much depends on the direction of the US economy, inflation trends, and how the Federal Reserve handles monetary tightening. If inflation cools down, gold could face more downward pressure; however, any sign of economic uncertainty might push investors back toward gold as a safe investment.

In Pakistan, the gold market also depends on exchange rate fluctuations and import costs, both of which are influenced by global developments. Analysts suggest that this might be a good time for small investors to buy gold gradually, as prices are expected to stabilize in the medium term.

The Bottom Line

The sharp drop in gold prices in Pakistan following the global decline highlights how interconnected international and domestic markets have become. Whether it’s a momentary dip or the start of a longer trend remains to be seen. But for now, buyers have a golden opportunity to make the most of lower prices while investors will be watching closely to see where the market heads next.