Gold hits all-time high of Rs308,000

Jumps Rs3,800/tola while rupee slips to 279.47/$; SBP raises Rs258.8b in T-bills against Rs350b target

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KARACHI:

Gold prices in Pakistan soared on Wednesday, aligning with an uptrend in international markets. The price per tola surged by Rs3,800, reaching a record high of Rs308,000, while 10-gram gold climbed to Rs264,060, an increase of Rs3,258, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA). This followed Tuesday's increase of Rs1,000 per tola, indicating sustained bullish momentum. Globally, gold rose by $34, reaching $2,944 per ounce, including a $20 premium.

"Gold prices have hit their highest levels in both local and international markets," said Abdullah Abdul Razzaq, a member of the APGJSA.

Adnan Agar, Director of Interactive Commodities, noted that the international gold market has exhibited strong upward momentum. Initially, a correction was expected around $2,850-$2,820, but prices rebounded sooner than anticipated, reinforcing a bullish trend. The surge is driven largely by geopolitical uncertainty, particularly rising tensions between the US, Russia, and Ukraine, which have increased demand for safe-haven assets like gold. Speculative trading has also contributed significantly, with traders capitalising on market sentiment.

Despite the rally, Agar pointed out the absence of a significant correction. Historically, gold experiences periodic pullbacks after major gains. Over the past 18 months, prices have surged by $1,150, but unlike previous cycles, the market has yet to witness a healthy retracement of $400-$500, which typically precedes a more stable upward trend, he said. Analysts predict that gold could breach the $3,000-$3,100 mark in the coming months. However, if a correction occurs, a major price adjustment may follow. Traders remain cautious, as the lack of a proper pullback could lead to increased volatility.

Meanwhile, the Pakistani rupee weakened slightly against the US dollar, depreciating 0.04% in the inter-bank market on Wednesday. The rupee closed at 279.47, down by 10 paisa from the previous day's rate of 279.37.

Additionally, the State Bank of Pakistan (SBP) raised Rs258.8 billion in its latest T-Bill auction, falling short of the Rs350 billion target. The auction attracted total bids of Rs737 billion. Cut-off yields for 3-month, 6-month, and 12-month T-Bills increased by 2bps, 17bps, and 6bps, respectively, settling at 11.8247%, 11.6749%, and 11.6498%.