On Monday, March 23, 2026, coinciding with the third day of Eid al-Fitr celebrations, gold prices in Pakistan experienced a significant decline, reaching their lowest point in the last four months. This downward movement closely followed trends observed in the international bullion markets, reflecting broader economic and geopolitical developments. The All Pakistan Sarafa Gems and Jewellers Association confirmed this drop, highlighting the ongoing volatility affecting precious metals.
The price of 24-karat gold per tola saw a sharp decrease, falling by Rs43,600 to close at Rs447,762. This was a notable drop from the previous trading session’s rate of Rs491,362. Similarly, the cost of 10 grams of 24-karat gold also declined substantially, losing Rs37,380 and settling at Rs383,883, compared to Rs421,263 recorded just before the Eid holidays on Friday. Alongside gold, silver prices also slipped, with a reduction of Rs800 per tola, bringing the rate down to Rs6,884 from Rs7,684.
These local price movements mirrored the international gold market, where prices dropped by $436 per ounce, settling at $4,250. Analysts attribute this volatility largely to rising crude oil prices amid escalating geopolitical tensions in the Middle East. Recent airstrikes conducted by the United States and Israel targeting Iran have intensified uncertainty in global markets, particularly affecting energy supplies and investor confidence.
Tim Waterer, the chief market analyst at KCM Trade, explained that the ongoing conflict involving Iran, now entering its fourth week, has shifted market expectations. With oil prices hovering near the $100 mark, investors are now anticipating potential interest rate hikes rather than cuts. This shift has reduced gold’s attractiveness as an investment, especially since it does not yield interest or dividends. Waterer further noted that gold’s high liquidity is contributing to its current weakness, as investors are forced to liquidate gold holdings to meet margin calls triggered by downturns in stock markets.
Compounding the situation, the closure of the Strait of Hormuz, a critical chokepoint for global oil shipments, has kept crude prices elevated. This has sparked fears of rising inflation by increasing transportation and manufacturing costs worldwide. Typically, inflationary pressures boost demand for gold as a hedge, but the prospect of higher interest rates tends to suppress appetite for non-yielding assets like gold. This complex interplay of factors is creating a challenging environment for gold prices both globally and within Pakistan.
As Eid festivities continue, investors and traders remain cautious, closely monitoring geopolitical developments and economic indicators that could influence precious metal prices in the coming weeks. The current scenario underscores the sensitivity of gold markets to external shocks, especially in regions heavily dependent on oil imports and vulnerable to international conflicts.
