Gold slides below Rs500,000 as global prices slump

Yellow metal prices extend sharp slide amid international selloff, higher margins

KARACHI:

Gold prices in Pakistan extended their steep decline, sliding below Rs500,000 on Monday, tracking heavy losses in international markets as bullion and silver remained under pressure due to higher margin requirements imposed by CME Group, a derivatives marketplace, and a broader reassessment of interest-rate expectations following the nomination of Kevin Warsh as the next chair of the US Federal Reserve.

In the local market, the price of gold per tola fell sharply by Rs21,500 during the day to settle at Rs490,362, according to rates released by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA). Similarly, the price of 10-gram gold declined by Rs18,433 to Rs420,406.

The latest drop follows an equally severe correction on January 31, when gold per tola closed at Rs511,862 after plunging by Rs25,500 in a single session, underscoring the heightened volatility gripping the bullion market.

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Silver prices also came under pressure, with the per-tola rate slipping by Rs601 to Rs8,405, reflecting the sharp selloff witnessed in international markets.

Globally, spot gold was down 5.2% at $4,613.99 an ounce by 11:00 am ET (1600 GMT), after plunging nearly 10% earlier in the session, according to Reuters.

US gold futures for April delivery also weakened, falling 2.3% to $4,636.90 an ounce. Market participants attributed the selloff to a combination of profit-taking, tighter trading conditions after margin hikes, and shifting expectations around US monetary policy.

The previous session marked gold’s steepest single-day fall since 1983, although analysts stressed that the sharp correction does not necessarily signal a sustained downturn in prices.

Read More: Gold crashes by over Rs35,000 per tola

Silver, meanwhile, has dropped more than 37% from its recent record high, highlighting the scale of the pullback after an exceptionally strong rally earlier this year.

Commenting on the situation, Interactive Commodities Director Adnan Agar said gold had touched an intraday low of $4,400 before recovering to around $4,680, after earlier reaching a peak of $4,884.

He attributed the recent volatility to markets becoming significantly overstretched, noting that silver had delivered abnormal returns of nearly 40% and gold around 15–18% within the first month of the year alone.

Such rapid gains, he said, often lead to sharp corrections, with gold falling by nearly $1,200 from its highs and silver by about $50 to $55.

Despite the magnitude of the selloff, Agar maintained a generally bullish long-term outlook, suggesting that potential dips toward $4,200 for gold and the $60–65 range for silver could present buying opportunities rather than reasons for panic.