Tuesday July 23, 2024

Gold rate in Pakistan jumps to all-time high amid political uncertainty

Gold rate jumps to record high of Rs230,100 per tola

By Business Desk
May 09, 2023
People buy jewellery at a jewellery store in Amritsar on October 22, 2022. — AFP/File
People buy jewellery at a jewellery store in Amritsar on October 22, 2022. — AFP/File

As investors' attention shifted to the safe-haven bullion due to the political uncertainty that ensued after the arrest of Pakistan Tehreek-e-Insaf (PTI) Chairman Imran Khan, gold prices in Pakistan surged to another all-time high Tuesday.

The rate of gold (24 carats) increased by Rs3,200 per tola and Rs2,744 per 10 grams to reach Rs230,100 and Rs197,274, respectively, according to data provided by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA).

Gold rate has been increasing persistently and hitting new highs almost every other day due to economic uncertainty, but market experts attributed today's rise to the arrest of Khan — who was apprehended in the Al-Qadir Trust case.

With the economy in dire straits, people prefer to buy yellow metal to protect themselves against inflation and currency depreciation.

The weekly inflation hit an all-time high of 48.35% year-on-year (YoY) with prices of chicken and wheat flour increasing during the seven-day period ending May 4.

Meanwhile, it seems that Pakistan may not get the crucial tranche from the IMF anytime soon, as the country’s loan programme is not on the agenda of the lender’s Executive Board till May 17.

Pakistan and the IMF have been discussing fiscal policy measures in the review since February, aiming to resume stalled funding of $1.1 billion due in November from a $6.5-billion programme agreed in 2019.

The delay in the revival of the IMF programme negatively impacts the currency market which, in turn, bolsters the demand for gold.

Data shared by the association also showed that the price of silver hit record highs after they increased by Rs100 per tola and Rs85.72 per 10 grams to settle at Rs3,000 and Rs2,572, respectively.

The rise in the gold price also came as the precious metal's value increased in the international market by $9 to settle at $2,031 per ounce.