Karachi, January 17, 2024 – On Wednesday, gold prices in Pakistan took a significant hit, plummeting by Rs 3,600 per Tola, driven by a combination of falling global prices and an appreciating Pakistani Rupee (PKR) against the US dollar.
The 24-karat gold per tola witnessed a notable decline, closing at Rs 213,700, down from the previous day’s closing figure of Rs 217,300. Similarly, the 24-karat gold per 10 grams experienced a substantial dip, sliding by Rs 3,087 to conclude at Rs 183,213, compared to the preceding day’s closing of Rs 186,300 in the domestic markets.
Financial analysts are pointing to two primary factors contributing to this sharp decline in precious metal prices. First and foremost is the global trend, with gold losing $22 to settle at $2,045 per ounce, down from the previous day’s closing of $2,067 in the international markets. This decline reflects a broader sentiment in the global gold market, impacting prices across borders.
Furthermore, the appreciation of the Pakistani Rupee against the US dollar is identified as a significant factor influencing the local gold market. The gold market in Pakistan is closely tied to the exchange rate, and any fluctuations in the value of the national currency can have a direct impact on the prices of precious metals.
In the global context, gold has been facing headwinds due to a variety of factors, including shifts in investor sentiment, geopolitical developments, and changes in economic outlooks. The $22 drop in the international price of gold further exacerbates the challenges faced by local markets dependent on gold imports, such as Pakistan.
Importantly, the appreciation of the Pakistani Rupee against the US dollar has been a gradual but consistent trend. A stronger local currency means that the cost of importing gold decreases, contributing to the downward pressure on gold prices in the country. Given Pakistan’s heavy reliance on gold imports, changes in the exchange rate can have a profound impact on the domestic gold market.
Market observers are closely monitoring the situation to gauge whether the current trend in gold prices is a short-term correction or part of a more sustained shift in the market dynamics. The interconnected nature of global financial markets and currencies means that local events and trends are often influenced by broader international developments.
As Pakistan continues to navigate these economic fluctuations, stakeholders in the gold industry, as well as investors and consumers, will be keenly watching for any signs of stabilization or further volatility in the precious metal market. The ongoing interplay between global market trends and local economic conditions will undoubtedly shape the trajectory of gold prices in the coming weeks.
