KARACHI: Gold continued losing its shine in Pakistan on Wednesday, declining by Rs2,850 per tola to Rs122,000 — in line with the trend in global markets.
Bullion prices in the local market recorded a decrease of Rs2,444 per 10 grams to settle at Rs104,595 per 10 grams.
The plunge comes on the back of concerns that the State Bank will raise its benchmark interest rates. Gold — often viewed as an inflation-hedge — had so far benefited from lax interest rates during the pandemic. Any hike in rates will reduce bullion’s appeal, as higher interest rates raise the opportunity cost of holding thenon-interest-bearing metal.
Cumulatively, the precious commodity has lost around Rs7,100 per tola during the last five sessions.
The metal receded $12 per ounce to settle around $1,862 in the international market, according to All Sindh Saraf Jewellers Association (ASSJA).
It is pertinent to mention that gold rates in Pakistan are around Rs4,000 below cost compared to the gold rate in the Dubai market.
Meanwhile, silver prices in the domestic market recorded a decrease of Rs40 per tola and Rs34.30 per 10 grams to settle at Rs1,440 per tola and Rs1,234.56 per 10 grams today.