Gold prices in Pakistan fell on Monday, September 7, following a decline in international bullion prices amid continued geopolitical uncertainty and changing market expectations.
According to rates issued by the All Pakistan Sarafa Gems and Jewellers Association, the price of 24-karat gold dropped by Rs2,400 per tola to Rs463,136.
The price of 24-karat gold for 10 grams declined by Rs2,058 to Rs397,064. Meanwhile, 22-karat gold fell by Rs1,887 per 10 grams to Rs363,988.
International Gold Prices Also Decline
Gold prices also weakened in the international market. According to the association, international gold fell by $24 to $4,406 per ounce.
Silver prices followed the downward trend in Pakistan. The price of silver decreased by Rs39 per tola to Rs7,059. The price of 10 grams declined by Rs34 to Rs6,051.
International silver prices also dropped by $0.39 to $65.80 per ounce.
Geopolitical Tensions Keep Markets Under Watch
Investors continued to monitor developments in the Middle East as tensions remained elevated and diplomatic efforts continued to seek a lasting resolution to the regional conflict.
Gold is widely considered a safe-haven asset during periods of economic and geopolitical uncertainty. In Pakistan, it also remains a popular store of value because of inflation and fluctuations in the rupee.
Many households invest in gold to preserve wealth. Jewellery and bullion can also be sold relatively easily when financial needs arise.
Ole Hansen, head of commodity strategy at Saxo Bank, said gold and silver had moved in the opposite direction to energy prices. He linked the continued decline to stronger US employment data, which pushed bond yields higher and reinforced expectations of a Federal Reserve rate hike on September 16.
Higher interest rates can reduce the appeal of gold because the precious metal does not generate interest or other regular income.
At the same time, inflation concerns remained elevated as oil prices increased following weekend strikes targeting shipping. Iran has also indicated plans to announce a restricted zone in the Gulf and provide maps for a new shipping corridor through the Strait of Hormuz.
The combination of global interest rate expectations, energy prices and geopolitical developments is likely to remain important for gold and silver prices in the coming sessions.
