Gold falls despite 2% global surge

Local rate dips Rs5,200/tola but international bullion rebounds on soft jobs data

KARACHI:

Gold prices in Pakistan declined on Wednesday, bucking a sharp global rally, as the local market showed muted response amid limited trading activity and rupee dynamics.

According to the All-Pakistan Gems and Jewellers Sarafa Association, the price of gold per tola dropped by Rs5,200 to settle at Rs419,636. Similarly, the 10-gram gold was traded at Rs359,770 after a decline of Rs4,458.

The decline came despite a strong rebound in international bullion prices. Spot gold surged more than 2% to $4,087.21 per ounce by 11:50 am ET (1550 GMT), recovering from its lowest level since November hit in the previous session, as per Reuters. US gold futures for August delivery rose 1.6% to $4,101.60. The yellow metal, however, posted a quarterly loss on Tuesday.

Market participants attributed the global uptick to softer-than-expected US private payrolls data for June, which reinforced expectations of monetary easing. Federal Reserve Chair Kevin Warsh's remarks suggesting that inflation risks had eased further buoyed investor sentiment in the precious metals market.

The divergence between local and international trends highlighted the ongoing dynamics in Pakistan's gold market, including import costs, currency fluctuations, and domestic demand patterns. Jewellers and investors closely monitor such movements, as gold serves both as a hedge against inflation and a key demand component of the wedding and festive season. Meanwhile, silver prices also eased in the local market, falling Rs107 to Rs6,242 per tola.