Gold prices in Pakistan experienced a dramatic fall on Monday, marking one of the steepest single-day declines in recent memory. This sharp downturn followed a significant drop of over eight percent in the international gold market, bringing global prices to their lowest point in four months. The decline reflects growing unease over escalating conflicts in the Middle East, which have intensified inflation worries and shifted market expectations towards potential interest rate hikes worldwide.
On the global front, gold prices fell by 6.3 percent to $4,203.21 per ounce, extending losses for the ninth consecutive trading session. This sustained downward trend in the precious metal’s value has had a direct impact on Pakistan’s local market, where the price per tola plummeted by Rs43,600. Consequently, the new price settled at Rs447,762 per tola, a record single-day drop that has caught the attention of investors and traders across the country.
The All-Pakistan Gems and Jewellers Sarafa Association (APGJSA) confirmed the sharp decline, noting that the price per 10 grams of gold also took a significant hit, falling by Rs37,380 to reach Rs383,883. Silver prices were not spared either, decreasing by Rs800 to Rs6,884 per tola. This widespread drop in precious metal prices comes after silver experienced its steepest weekly loss since February 1983, plunging more than 10 percent last week and retreating roughly 25 percent from its record high of $5,594.82 per ounce recorded on January 29.
In the United States, gold futures for April delivery mirrored this bearish trend, dropping 8.1 percent to $4,205.10 per ounce. Market analysts attribute the decline to the ongoing geopolitical tensions, particularly the conflict involving Iran, which has now entered its fourth week. The unrest has kept oil prices elevated, hovering around the $100 mark, which has shifted investor sentiment from anticipating rate cuts to bracing for possible interest rate increases. This shift has diminished gold’s attractiveness as an investment, especially since higher interest rates tend to reduce demand for non-yielding assets like gold.
Adding to the tension, Iran recently warned that it would target the energy and water infrastructure of its Gulf neighbors if the United States, under President Donald Trump’s administration, proceeded with threats to disrupt Iran’s electricity grid. This escalation has contributed to volatility in Asian stock markets and kept oil prices above $110 per barrel. The potential closure of the Strait of Hormuz, a critical chokepoint for global oil shipments, has further fueled inflation fears by increasing transportation and manufacturing costs worldwide.
Other precious metals also suffered significant losses amid this turbulent environment. Spot silver declined by 6.1 percent to $63.66 per ounce, while platinum prices dropped 6.4 percent to $1,799.25, both hitting their lowest levels since mid-December. Palladium was not immune, falling 3.6 percent to $1,352.75 per ounce. These declines underscore the broader impact of geopolitical instability and economic uncertainty on the precious metals market globally.
