Gold price surge intensifies in Pakistan, reaching fresh highs
Gold prices in Pakistan reached a historic high on Tuesday, with the price per tola (approximately 11.66 grams) reaching Rs. 388,100. This significant increase can be attributed to a combination of global, regional, and local factors.
International markets play a crucial role in determining the price of gold. The price is primarily traded in US dollars on exchanges such as London, New York, and Shanghai. In Pakistan, the local price is also influenced by the exchange rate of the US dollar against the Pakistani Rupee. When the Rupee depreciates against the dollar, as is often the case in Pakistan, the local gold price increases, even if the international gold price only moderately rises.
Local factors such as political uncertainty, inflation, demand for gold as a safe investment, high import duties and taxes, and local supply and demand situations also impact the price of gold.
Official gold prices in Pakistan are announced by local associations such as the All Pakistan Sarafa Gems and Jewellers Association. These associations release daily price lists that are based on international market trends and are binding for all traders. Local jewellers and banks usually follow these official rates, although they may sometimes offer gold at slightly varying prices.
On Monday, the gold price in Pakistan reached Rs. 384,000 per tola, an increase of Rs. 6,100. The price of 10-gram gold was Rs. 329,229 on the same day. The price of silver per tola in Pakistan also saw an increase on Tuesday, reaching Rs. 4,358.
The surge in gold prices has been driven by a variety of factors. A weaker US dollar and a dip in bond yields led to an increase in the international gold price by $41 on Tuesday, with the rate reaching $3,654 per ounce. The premium for gold internationally remained at $20 on Tuesday.
The high import duties and taxes on gold in Pakistan contribute to the high local price. The increase in gold prices has led to a rise in demand for the precious metal.
It is important to note that no single individual or organization "raises" the gold price in Pakistan. Instead, the price is determined globally and is made known locally by associations like the All Pakistan Sarafa Gems and Jewellers Association. This organization publishes the daily rates, but it does not set the price; rather, it adjusts it to reflect international market trends and the exchange rate.
Rising gold prices in Pakistan are usually a sign of a weak Rupee and/or an economically uncertain situation, not the actions of a single actor. If you're interested in learning more about the developments in Pakistan or specific days, please let us know!
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