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Gold Price in Pakistan Edges Upward Slightly

Gold Price in Pakistan Edges Upward Slightly

Gold prices in the global market experienced a notable uptick, rising by 1.1 percent to reach $2,196.21 per ounce. This increase was primarily driven by a weaker dollar, which typically enhances the appeal of gold as a safe-haven asset. Moreover, investor attention has shifted towards the release of upcoming US inflation data, anticipated later in the week. This data is expected to offer insights into the Federal Reserve’s stance on interest rate adjustments, further impacting gold prices.

Domestic Economic Conditions:

In Pakistan, the price of gold surged to Rs. 229,400 per tola for 24-carat gold, marking a significant increase. This rise in domestic gold prices, by Rs. 1,200 per tola, can be attributed to the global uptrend in gold prices. Additionally, the price of 10 grams of gold rose by Rs. 1,029 to reach Rs. 196,674. The domestic gold market is closely influenced by international trends, and any fluctuations in global gold prices often reflect in local markets.

Federal Reserve’s Monetary Policy Expectations:

Last week, Federal Reserve policymakers signaled a potential interest rate cut totaling three-quarters of a percentage point by mid-2024. Such dovish monetary policy indications typically bolster gold prices, as investors seek alternative assets amid expectations of lower interest rates. This forward guidance from the Federal Reserve has contributed to the recent surge in gold prices, both globally and domestically.

In summary, the increase in the price of gold in Pakistan can be attributed to a combination of factors, including international market dynamics, domestic economic conditions, and expectations regarding the Federal Reserve’s monetary policy stance. These factors collectively contribute to shaping the trajectory of gold prices in the country’s market.