Gold at Rs303k on trade war

Prices surge Rs4,000 to all-time high as safe-haven demand rises; rupee loses 17 paisa to 279.22/$

KARACHI:

Gold prices in Pakistan surged on Monday, rebounding sharply after a previous session decline, driven by global market trends amid escalating trade tensions. The price of gold per tola jumped by Rs4,000 to an all-time high of Rs303,000, while the 10-gram rate rose Rs3,429 to settle at Rs259,773, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).

Globally, gold remained firm near record highs as investors sought safe-haven assets in response to growing geopolitical and economic uncertainty. Adnan Agar, Director of Interactive Commodities, attributed the surge to fears of a renewed trade war following tariff proposals by US President Donald Trump.

Trump has proposed reciprocal tariffs on countries taxing American goods, potentially impacting commodities like aluminium and copper. The possibility of escalating trade tensions has pushed investors toward gold, traditionally seen as a hedge against economic instability.

Additionally, China's central bank expanded its gold reserves for a third consecutive month in January, despite the metal's record-high rally, Bloomberg reported. The People's Bank of China increased its holdings by 0.16 million troy ounces, continuing a buying trend that resumed in November after a brief pause.

Agar noted that the gold market is in a strong bullish phase, frequently reaching new highs. While minor corrections are expected, significant pullbacks remain unlikely. A short-term dip of $50–$60 per ounce could be followed by a surge of $80–$90, he said.

Ongoing geopolitical tensions—such as the Israel-Palestine conflict—and uncertainty in global trade suggest continued investor interest in gold. Analysts believe any slight dip will be viewed as a buying opportunity before the next rally. For now, the momentum remains bullish, and investors are closely monitoring economic data and geopolitical developments for further market cues, he added.

Meanwhile, the Pakistani rupee saw a slight decline against the US dollar on Monday, depreciating by 0.06% in the inter-bank market. The rupee settled at 279.22, losing 17 paisa against the dollar, according to the State Bank of Pakistan (SBP). This follows last week's minor depreciation of 0.04%, closing at 279.05 from 278.95.

Globally, the US dollar strengthened on Monday after Trump announced plans to impose 25% tariffs on all steel and aluminium imports, putting pressure on the euro, Australian dollar, and New Zealand dollar.