Gold price in Pakistan fell for the third straight session on Wednesday following the rupee’s appreciation against the dollar and as massive decline in the international market.
Data released by All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the price of gold (24 carats) plunged by Rs2,300 per tola and Rs1,971 per 10 grams to settle at Rs201,900 and Rs173,097. Cumulatively, the safe-haven metal has fallen from Rs208,300 per tola to Rs201,900 in three sessions after registering losses of Rs6,400 per tola. The price of gold declined despite a scurry in the local market ahead of Ramadan as people purchase the precious commodity during the holy month which is followed by a wedding season.
Gold plunged in line with the dollar’s value (in Pakistan) as the country meets almost all its gold demand through imports, and traders follow its international price in setting rates in the country. Jewellers import the metal against the US dollar and UAE dirham before converting its price into rupees. The association also mentioned that the price of gold is Rs14,000 per tola “undercost” in Pakistan, as compared to the Dubai market, showing that the Pakistani gold market was currently cheaper than the global.
In the international market, gold traded in a tight $12-range on Wednesday as traders positioned for the US Federal Reserve’s interest rate decision and Chair Jerome Powell’s comments on the path of future hikes. The per-ounce price settled at $1,939 after a decline of $29. The decision is expected at 2pm ET (1800 GMT), and the Fed is largely expected to increase rates by 25 basis points, according to the CME FedWatch tool, while some Wall Street banks are split over a hike or a pause. Meanwhile, silver prices in the domestic market remained unchanged at Rs2,200 per tola and Rs1,886.14 per 10 grams, respectively.