KARACHI: Gold prices reversed course and fell on Wednesday as the dollar eased in the international market, while investors braced for a speech by US Federal Reserve Chair Jerome Powell for hints on future interest rate rises.
Data released by All Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the gold price declined by Rs400 per tola and Rs314 per 10 grams to settle at Rs161,200 and Rs138,203, respectively.
Initially, gold was showing signs it was possibly stabilising, but investors are still nervous ahead of the US Fed policy announcement on how aggressive the central bank will be.
The rupee’s stability hurt gold even though the precious metal is regaining shine in the international market. However, local investors will not immediately jump back into gold.
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.
In the international market, the price of the yellow metal rose by $4 per ounce settling at $1,760 and was headed for its biggest monthly gain in more than two years.
Gold rates in Pakistan are around Rs1,000 below the cost compared to the rate in the Dubai market.
Meanwhile, silver prices in the domestic market remained unchanged at Rs1,740 per tola and Rs1,491.76 per 10 grams.