Gold Price Surpasses Rs200,000 per tola on Friday

Following the rupee’s freefall against the US dollar on Friday, the price of gold topped Rs200,000 per tola (11.66 grammes) for the first time in Pakistan’s history.

However, the increase in bullion prices has made jewellers upset, since legitimate customers have left the market and gamblers have entered.

Speaking on the occasion, local gold pricing body Head Haji Haroon Chand Rashid remarked, “Speculators are minting money in the name of ‘investment’. They generate money and then disappear, leaving legitimate investors perplexed.”

In Pakistan, the price of the precious metal rose from Rs7,000 a tola to Rs202,500. The latest price increase comes after the rupee fell 2.73%, or Rs7.17, to an all-time low of Rs262.60 versus the US dollar in the interbank market on Friday.

“As gold remains a worldwide commodity, the rupee-dollar exchange rate influences bullion prices in Pakistan,” Rashid explained.

However, Pakistan is no longer servicing its need through imports.

“The gold available in the country is currently in circulation in the market. “The price increase is unjustifiable,” he stated, adding, “I will register my objection tomorrow” (Saturday).

Over time, the steady rate escalation has led several jewellers and workshops to close, displacing a number of workers.

“Despite the fact that it is peak wedding season, there are very few jewellery purchasers visiting the stores. Only 10-tola TT bars are now in demand. Instead of creating new designs for wedding houses, goldsmiths are now spending their time melting existing jewellery to transform it into gold bars, as investors want,” Rashid complained.

When US dollars began to disappear from the open market, investors began to turn to gold bars as safe havens for their funds.

“However, gamblers are now playing the gold markets, and they are the reason for this steady rise,” he explained.

In 2022, gold was the leading asset in terms of return on investment (ROI) in Pakistan. It provided a 41% ROI (profit) for the year.

According to a worldwide survey, demand for gold in Pakistan increased by 43% between July and September 2022, reaching 13 tonnes.

The All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) reported a rise in gold prices despite the commodity’s dip in world markets by $6 per ounce (31.10 gramme) to $1,930.

AA Gold Commodities Director Adnan Agar remarked, “Considering the problem surrounding the country’s foreign exchange reserves, moving forward, the rupee may sustain a negative trend and gold rising.

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