Gold retreats from peak; per tola down Rs1,100

KARACHI: Gold prices retreated from record highs in both local and international markets, with the price per tola in Pakistan dropping by Rs1,100 to Rs246,500 on Saturday,

The All Pakistan Gems and Jewellers Sarafa Association (APGJSA) said the 10-gram gold price also fell by Rs943 to Rs211,334.

Earlier in the week, gold had surged by Rs1,900 per tola in Pakistan amid safe-haven demand due to geopolitical tensions in Ukraine and Gaza.

However, global gold prices slipped as the US dollar and Treasury yields rose following a stronger-than-expected U.S. inflation report, which dampened expectations of an early rate cut by the Federal Reserve.

Internationally, gold was priced at $2,364 per ounce, down $11, with a premium of $20, APGJSA reported. Silver prices in Pakistan remained stable at Rs2,650 per tola.

Gold hit above $2,400 per ounce to an all-time high on Friday as growing tensions in the Middle East prompted investors to seek refuge in the safe-haven assets.

Later in the trade, spot gold eased 0.8 percent to $2,353.35 per ounce, taking a breather after hitting a record high of $2,419.79. Prices were up around 1 percent for the week. US gold futures settled 0.1 percent higher at $2,374.1.

Taking cues from gold's upward momentum, platinum tested the key $1,000 per ounce level to its highest level in nearly four months.

"What's really telling about the strength of gold is the U.S. dollar index and Treasury yields are climbing, yet gold continues to rally strongly - that's very indicative of strong safe-haven demand," said Jim Wyckoff, senior analyst at Kitco Metals.

A reportedly imminent attack by Iran on Israel is a real and viable threat, the White House said, giving no details about possible timing, reiterating that the U.S. takes its commitments to defend Israel seriously.

"Gold continues to go from strength to strength as we are witnessing fear of missing out on clear display," Ole Hansen, head of commodity strategy at Saxo Bank, said in a note.

Gold's recent surge arrived despite traders dialing back bets for an early interest rate cut from the Federal Reserve.

"Gold has pushed back against some data that should have typically been negative. It will be somewhat healthy to see a correction in the bull's market, but the trend will continue to be positive," said Chris Gaffney, president of world markets at EverBank.

Wall Street’s main indexes plummeted on Friday, capping a week marked by hotter-than-expected inflation and jobs data that forced investors to reset expectations for the timing of interest rate cuts.

Meanwhile, Goldman Sachs hiked its year-end gold price forecast to $2,700 per ounce from $2,300, citing the metal's bull market's indifference to the usual macro factors.

Spot silver fell 1% to $28.21 per ounce, after touching its highest level since early 2021. Platinum rose 0.6% to $985.65 and palladium firmed 0.9 percent to $1,055.62.