Saturday May 25, 2024

International increase pushes up gold price in Pakistan

Bullion rate in global market rises by $7; local price jumps by Rs3,200 per tola

By Business Desk
May 13, 2023
A gold set is displayed at a jewellery store in this undated file photo. — AFP
A gold set is displayed at a jewellery store in this undated file photo. — AFP

As the international rate of the safe-haven bullion rose, the price of gold also increased in Pakistan on Saturday.

The rate of gold (24 carats) rose by Rs3,200 per tola and Rs2,743 per 10 grams to reach Rs234,000 and Rs200,617, respectively, according to data provided by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA).

Meanwhile, the international gold rate settled at $2,010 per ounce after gaining $5.

Analysts have said the international rate will continue to fluctuate in the current month amid uncertainty around the raising of the US debt ceiling. 

The yellow metal’s value had reached a record high of Rs240,000 per tola on May 10 amid increased political uncertainty and violence following Pakistan Tehreek-e-Insaf (PTI) Chairman Imran Khan’s arrest.

Cumulatively, gold gained Rs7,100 per tola this week.

Gold prices had already been reaching new highs in Pakistan almost every other day before May 10 due to several factors — economic and political turmoil, high inflation, and currency depreciation. People prefer to buy the yellow metal in such times as a safe investment and a hedge.

The government is yet to sign a staff-level agreement with the International Monetary Fund (IMF) for the release of a crucial economic bailout despite several months of talks, with international agencies warning that Pakistan risks default following the end of the current loan programme.

The country’s foreign exchange reserves are at a critically low level — not enough for even one month’s imports — and the rupee touched a new low of Rs300 against the US dollar on May 11.

Besides this, inflation has reached a record level and is the highest in South Asia while violent protests flared up for days after the PTI chairman’s arrest.

Data provided by the association today showed that the price of silver also rose by Rs100 per tola and Rs85.74 per 10 grams to reach Rs2,900 and Rs2,486.28, respectively.