Gold heads for second weekly drop in Pakistan

F.P. Report

KARACHI: Gold prices once again reversed their uptrend and fell below the psychological threshold of Rs145,000 per tola in line with the decline in the yellow metal prices.

Data released by All Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the gold price gained Rs1,250 per tola and Rs1,072 per 10 grams to settle at Rs143,800 and Rs123,285, respectively.

Gold prices were stuck in a tight range as investors braced for the State Bank of Pakistan’s monetary policy decision, which could influence the market direction.

The precious commodity is highly sensitive to rising interest rates, as these increase the opportunity cost of holding non-yielding bullion while boosting the currency, in which it is priced.

Cumulatively, the precious metal lost Rs2,700, or 1.84%, per tola during the week ended October 8.

Gold traders once again are deciding to focus more on the central bank’s policy rate decision and less on the political and economic uncertainties that might prompt some safe-haven demands.

In the international market, the price of yellow metal plunged by $14 and fell below the key $1,700 per ounce level. The price settled at $1,695.

Both, local and international, markets will now be focused on the monetary policy meeting and Fed minutes.

Gold rates in Pakistan are around Rs3,000 below the cost compared to the rate in the Dubai market.

Meanwhile, silver prices in the domestic market remained unchanged at Rs1,580 per tola and Rs1,354.60 per 10 grams.