In line with the international market, the price of gold plunged by a whopping 3.1% in the domestic market amid no demand from consumers.
Data released by the All Sindh Sarafa Jewellers Association (ASSJA) showed that the gold prices in the local market recorded a decrease of Rs4,300 per tola and Rs3,686 per 10 grams to settle at Rs134,200 and Rs115,055.
The price of the precious commodity is declining because of the continuous appreciation of the Pakistan rupee against the US dollar — which has recovered nearly 12% or Rs26 — and fading concerns regarding the deepening economic crisis.
Cumulatively, the precious commodity has lost Rs9,300 per tola since August 10.
The dealers had already anticipated the market to undergo a correction after the precious commodity scaled to new peaks. The gold hit an all-time high of Rs162,500 per tola on July 28.
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 commodity 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.
It should be noted that the gold price is standing below cost. Gold is cheaper by Rs7,500 per tola compared to its price in Dubai.
In the international market, bullion prices slid $27 per ounce to settle at $1,775 as investors turned cautious in the run-up to minutes of the previous US Federal Reserve policy meeting amid hawkish comments from the central bank officials.
Meanwhile, silver prices in the domestic market shed Rs20 per tola and Rs17.14 per 10 grams to settle at Rs1,540 and Rs1,320.30 today.