Price of gold increases by Rs2,200 per tola to settle at Rs207,200
Gold price in Pakistan continued its dazzling streak Thursday tracking the international precious metal markets that are rising in reaction to a hawkish US Federal Reserve, while the rupee’s plunging to a historic low also drove investors towards gold as saving options already remain limited.
Data released by the All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the price of gold (24 carats) increased by Rs2,200 per tola and Rs1,887 per 10 grams to settle at Rs207,200 and Rs177,641, respectively.
The precious commodity has been registering gains for two consecutive sessions amid falling forex reserves and a weak rupee — which will make it costlier as Pakistan meets its gold demand through imports.
Investors were, however, purchasing only gold bars, not jewellery, which had not only reduced goldsmiths' profit margins but the labour force was also at the stake of losing jobs, as jewellery makers were moving towards other professions in absence of work.
Gold rose to a nine-month high in the international market on a subdued dollar, as investors held onto the view that the US Federal Reserve would soon end its rate hiking cycle after it announced an expected 25-basis-point increase.
Spot gold was up $31 at $1,955 per ounce, having hit its highest since April 2022 earlier in the session.
The US central bank on Wednesday scaled back to a quarter-percentage-point rate increase after a year of larger hikes. It said it had turned a corner in the fight against high inflation, but that “victory” would still require rates to be increased further and remain elevated at least through 2023.
“There’s other statements where he (Fed Chair Powell) wanted to try and manage market expectations... But the dovish elements were there enough to continue to push gold higher,” said Craig Erlam, a senior market analyst at OANDA.
Meanwhile, silver prices in the domestic market increased by Rs50 per tola and Rs42.88 per 10 grams to settle at Rs2,300 and Rs1,971.88, respectively.
— Additional input from Reuters