Gold drops Rs2,700 per tola

Gold prices in Pakistan decreased on Friday despite a cautious uptick in international markets, as optimism over a potential resolution to the Iran conflict helped ease concerns surrounding inflation and elevated interest rates.

In the local bullion market, the price of gold per tola settled at Rs494,062 after registering a decline of Rs2,700 during the trading session, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA). Similarly, 10?gram gold was traded at Rs423,578, down by Rs2,315. The retreat came after a strong session on Thursday, when gold per tola surged by Rs7,800 to reach Rs496,762, reflecting heightened buying interest earlier in the week.

Internationally, spot gold rose 0.5% to $4,709.89 per ounce by 1551 GMT and was on track for a weekly gain of 2.1%, Reuters reported. US gold futures edged up 0.2% to $4,719.60 per ounce.

While gold is traditionally viewed as a safe?haven asset during geopolitical uncertainty, it continues to face headwinds in a higher interest?rate environment because it does not yield returns. However, easing tensions related to Iran have reduced some of the safe?haven demand, allowing the metal to consolidate within a range.

Adnan Agar, Director at Interactive Commodities, shared his analysis with The Express Tribune, noting that the market remains in a consolidation phase. "Today's high for gold was $4,749, the low was $4,790, and at the time of filing this report the market was at $4,707. There's no new development from Iran's side, so the market is in range trade and consolidation mode," he said.

Agar added that a decisive closing above $4,750 could open the path towards resistance levels at $4,850 and $4,900, potentially paving the way to the psychological $5,000 mark. Without a clear breakout, however, the precious metal is likely to remain within its current trading range.

On the domestic front, silver prices moved in the opposite direction. The white metal gained Rs80 per tola, closing at Rs8,525.

The mixed performance of precious metals comes as global investors monitor key economic indicators. Stronger?than?expected US employment data for April has further shaped market sentiment, influencing expectations around the Federal Reserve's monetary policy trajectory.

Analysts believe that any sustained de?escalation in Middle East tensions could keep gold under pressure in the near term, while persistent geopolitical risks or signs of economic slowdown may revive its appeal.

Meanwhile, the Pakistani rupee settled at Rs278.70 against the greenback, registering a modest gain of Rs0.01 compared with Thursday's closing level of Rs278.71.