Tuesday September 26, 2023

Political chaos sends gold prices soaring to Rs240,000/tola

May 11, 2023

KARACHI: Pakistan’s gold and silver prices reached an all-time high, with gold rising by Rs9,900/tola in a single day due to political unpredictability and a decrease in the value of the rupee relative to the US dollar.

According to the All Sindh Saraf Jewellers Association, gold prices increased by Rs9,900/tola to reach Rs240,000/tola. The cost of 10 gram gold also increased by Rs8,487 to stand at Rs205,761. However, gold prices on the foreign market remained constant at $2,031/ounce.

The country’s silver rates jumped up by Rs100, reaching an all-time high of Rs3,100/tola. Likewise, the price of 10 gram silver increased by Rs85.75 to stand at Rs2,657. Senior goldsmith in the city, Muhammad Shafi Khan claimed that the USD/PKR depreciation of roughly Rs5 was the main reason behind the rise in gold prices. Furthermore, the situation was made worse by the ongoing political unrest, which kept the market in disarray.

He said that there was significant demand for raw gold in the country and that local market gold prices were approximately Rs15,000/tola greater than those in the international market. Khan claimed that because the dollar was in short supply and gold was still considered a safe haven, even individuals were switching their investments from real estate to gold.

Due to the extremely low demand for jewellery, he claimed that there was virtually little remaining business for jewellers. According to him, the investors just wanted raw gold bars. He claimed that the market is panicking because of how quickly gold prices are rising, and gold is hard to find in the open market since it has been hoarded. “Decline of the Pakistani rupee against the US dollar, which has created value uncertainty for the currency and led more buyers to turn to gold, is the main driver of the rise,” he added.

Jewellers and employees are under pressure as a result of the rising price of gold, and the purchasing power of the majority of people has dropped. With the dollar scarce, jewellery sales down, and workers under pressure due to the current economic and political crises, investors are turning their attention to raw gold in the form of bars and biscuits. Prices have been rising steadily, with a few lulls here and there, but gold has just picked up the pace.