The price of gold in Pakistan climbed above Rs205,000 per tola on Tuesday as the rupee remained flat against the US dollar in the interbank market. Gold prices moved in line with the rupee-dollar parity as almost all of Pakistan’s gold demand is met through imports. Traders in the country follow the international price of gold in setting rates, with jewelers importing the metal against the US dollar and UAE dirham before converting its price into rupees. The All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) reported that the price of gold (24 carats) rose by Rs1,000 per tola to settle at Rs205,600, which is still Rs10,000 per tola under the cost of Dubai market gold. Meanwhile, silver prices in the domestic market remained unchanged at Rs2,250 per tola and Rs1,929 per 10 grams, respectively.
In the international market, gold prices steadied after an increase of $7 to settle at $1,957 per ounce, as investors favored higher-risk assets and banking worries eased. While in the near-term, gold prices could slip to $1,933, the outlook for gold remains bullish due to a fast-approaching peak in US rates and the danger of hitting a recession in the coming months. However, economists at Barclays wrote in a note that if inflation drops sharply but central banks are reluctant to lower rates in response, this could be detrimental to gold.
Overall, the price of gold in Pakistan is influenced by various factors, including the rupee-dollar parity, international gold prices, and import costs. While gold prices may fluctuate in the short term, its outlook remains positive due to economic uncertainties and the possibility of a recession.