KARACHI: The price of gold in Pakistan experienced a decline, retracting from its historic high due to investors’ shift in focus towards riskier assets, following positive economic indicators in the market. This decline broke a three-session winning streak for the precious commodity.
The depreciation is in line with the upward movement of the Pakistani rupee, which closed at 284.42 against the US dollar in the interbank market, and a downward trend in the global market.
According to data from the All-Pakistan Sarafa Gems and Jewellers Association, the gold rate (24 carats) fell by Rs2,500 per tola and Rs2,142 per 10 grams, settling at Rs214,500 and Rs183,900, respectively. The price of gold had been rising for the past three trading sessions, given its status as a hedge against inflation.
However, investors’ attention shifted to other markets, following gains in the Pakistani stock market and Saudi Arabia’s assurance to deposit $2 billion in Pakistan for the stalled bailout programme. The price of gold in Pakistan is significantly cheaper compared to the Dubai market, at a difference of Rs8,000 per tola.
On the other hand, silver prices in the domestic market remained unchanged. Internationally, the price of gold decreased by $4 per ounce, settling at $2,019.
The gold prices decreased as the Pakistani rupee strengthened by more than 1% against the US dollar in interbank trade due to hopes for the revival of the IMF bailout.
This came after Saudi Arabia confirmed that it will provide financial assistance to Pakistan. The rupee closed at 284.42 against the US dollar in the interbank market, up by 1.2% or Rs3.43 from the previous day’s close.
Analysts consider this a positive development, and believe that the local currency will remain resilient in the coming days if inflows are ensured. The IMF has received confirmation from Saudi Arabia on $2 billion in additional deposits, raising hopes for an early signing of the agreement.
