Business Desk 
Aug 02, 2024
Gold price rose to a fresh record high of Rs257,300 per tola on Friday with investors scurrying for a safe haven after a softening currency and bleak economic data underlined the shaky pace of growth.
Data released by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed the price of gold surged by Rs2,400 per tola and Rs2,057 per 10 grams to settle at Rs257,300 and Rs220,593.
Previously, gold price touched an all-time high of Rs254,000 per tola in the local market on July 18 as international investors opted for heavy positions in anticipation of the US central bank cutting interest rates in September 2024. However, trend of gold rate in Pakistan is range-bound.
The association reported that the price of gold has been “under cost”, as compared to prices in Dubai. This means that, at present, the Pakistani gold market is less expensive than the world market.
Silver prices in Pakistan remained unchanged at Rs2,900 per tola and Rs2,486.28 per 10 grams, respectively.
In the international market, gold prices were poised for their biggest weekly jump in four months on Friday, supported by safe-haven demand and expectations that the US Federal Reserve would start cutting interest rates in September as markets await key jobs report for further cues.
Spot gold was up 0.7% at $2,463.45 per ounce, as of 0915 GMT, just $22 shy of the record peak of $2,483.60 scaled on July 17. Bullion is on track for its biggest weekly gain since April 5.
"Gold prices are buoyed by rising expectations of rate cuts, driven by recent weak US economic data... additionally, fears of a retaliatory strike by Iran and its proxies in the Middle East are bolstering gold's appeal as a safe haven," said Zain Vawda, market analyst at MarketPulse by OANDA.
Bullion is considered a hedge against geopolitical and economic risks and lower rates reduce the opportunity cost of holding the asset.
How is gold price determined in Pakistan?
Gold price in Pakistan is announced by the All-Pakistan Sarafa Gems and Jewellers Association (APSGJA), which determines gold prices in Pakistan for local markets six days a week from Monday to Saturday.
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 rate in Pakistan 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.
