- Gold price settles at Rs146,400 per tola in Pakistan.
- Cumulatively, gold has lost Rs4,000 per tola in last three sessions.
- Demand for gold picked up pace as wedding season kicks off.
KARACHI: Gold extended losses into a third session on Saturday, closing slightly above the threshold of Rs146,000 per tola, contrary to the price movement in the international market and expectations that economic recovery could sap inflationary pressure, curbing the metal’s appeal as a hedge.
Data released by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the price of the precious metal declined by Rs1,00 per tola and Rs858 per 10 grams to settle at Rs146,400 per tola and Rs125,514 per 10 grams, respectively.
Cumulatively, the precious commodity has lost around Rs4,000 per tola in the last three sessions. Meanwhile, it lost Rs950 per tola during the week ending October 22.
Pakistan is a small market for gold at the global level. It meets the commodity’s demand through imports as it does not produce the precious metal locally.
Accordingly, the gold price for local markets is determined by keeping in view its prices in world markets, rupee-dollar exchange rate, and demand and supply in domestic markets.
The latest price for local markets was determined to keep in view the prices at which trade took place among buyers and sellers.
On the physical side, demand for gold in Pakistan picked up pace this week as some consumers bought into a retreat in domestic prices as the wedding season kicks off.
In the international market, the price of the yellow metal surged by $35 per ounce settling at $1,658 as the dollar weakened amid reports of a potential debate amongst the US Federal Reserve officials about the pace of rate hikes.
Gold is sensitive to rising interest rates, which increase the opportunity cost of holding bullion that does not pay interest.
The precious commodity’s rates in Pakistan are around Rs700 below the cost compared to the rate in the Dubai market.
Meanwhile, silver prices in the domestic market declined by Rs10 per tola and Rs8.56 per 10 grams to settle at Rs1,580 per tola and Rs1,354.60 per 10 grams.