Wednesday May 18 2022

Gold zooms to all-time peak in Pakistan as safety rush gathers steam

A representational image of the gold store. — Reuters/File
A representational image of the gold store. — Reuters/File

  • Gold price rise by Rs300 per tola to settle at Rs138,400.
  • Amid depreciation of rupee, dealers expect gold surge to continue.
  • Silver prices in domestic market remain unchanged.

KARACHI: Gold stormed to a historic high of Rs138,400 on Wednesday as investors sought refuge from a possible hit to the economy from an escalating political crisis, because of which the Pakistani rupee plummeted against the US dollar.

Amid the continuous depreciation of the rupee, dealers expect the gold surge to continue as the local currency sinks.

According to the All Sindh Sarafa Jewellers Association (ASSJA), the price of gold per tola rose by Rs300. Meanwhile, the price rose by Rs258 per 10 grams to settle at Rs118,656.

With the latest increase of Rs300 per tola today, the gold price has surged by a total of Rs3,000 in the last four sessions (Saturday-Wednesday).

Read more: Govt imposes ban on import of luxury, non-essential items

Gold has emerged as a safe asset during the ongoing economic crisis and people have been aggressively buying gold to protect their cash from deflation.

The drop in the rupee value — which slumped to an all-time low of Rs195.74 against the US dollar in the interbank market — forced the gold trading body to revise up the bullion price significantly as Pakistan meets the local demand for the precious yellow metal through imports.

In the international market, the price of yellow metal receded a significant decrease by $17 per ounce to settle at $1,816.

Gold rates in Pakistan are around Rs1,000 below the cost compared to the rate in the Dubai market.

Meanwhile, silver prices in the domestic market remained unchanged at Rs1,570 and Rs1,346.02 today.