Gold prices in Pakistan experienced a notable decline on Wednesday, with the price of a tola dropping by Rs3,500. This decrease reflected trends in international markets amid ongoing uncertainty surrounding US interest rate policies and geopolitical developments in the Middle East.
The All Pakistan Sarafa Gems and Jewellers Association reported that gold prices fell to Rs483,036 per tola from Rs486,536 recorded during the previous trading session. Similarly, the price of 10 grams of gold decreased by Rs3,100, settling at Rs414,125.
Gold prices in Pakistan have remained highly volatile, influenced by daily shifts in global bullion prices, fluctuations in the rupee-dollar exchange rate, and broader financial market dynamics worldwide.
Meanwhile, in global markets on Thursday, gold prices rose as concerns about a potential weakening of the US dollar and the country’s budget deficit persisted. Investors also awaited a significant speech from Federal Reserve Chair Kevin Warsh, which could provide insights into future monetary policy directions.
Spot gold increased by 0.8% to $4,630.09 per ounce, while US gold futures climbed 0.7% to $4,685.50. Senior market analyst Kelvin Wong from OANDA highlighted that apprehensions about a softer dollar and the US budget deficit continue to support gold prices over the medium term.
Last week, gold prices surged more than 5% following the US Treasury’s announcement of an extension on buybacks of older long-term bonds, intensifying concerns about dollar weakness. Wong added that markets are closely monitoring Warsh’s upcoming address at the annual Jackson Hole Symposium in Wyoming, as investors seek clarity on the Federal Reserve’s approach to monetary policy amid current economic conditions.
the CME FedWatch tool, the probability of a US interest rate cut in September stands at 36.5%, increasing to 72.7% by December. Additionally, data released on Wednesday revealed that US annual inflation for July remained steady, unexpectedly staying above the Federal Reserve’s 2% target for the 65th consecutive month.
Gold is widely regarded as a safe-haven asset during periods of geopolitical and economic uncertainty, although higher interest rates can diminish its attractiveness. Other precious metals also saw gains, with spot silver rising 1.7% to $69.28, platinum increasing 1.1% to $1,848.57, and palladium advancing 0.5% to $1,334.49 per ounce.
