After the dollar rise a lot, gold dropped from its all-time high.
On Thursday, the price of gold in Pakistan went down, and the precious metal fell from its all-time high. This happened because investors turned their attention to riskier assets after good economic signs in the market, ending a three-session winning streak.
The decline was in line with the movement of the rupee, which went up against the US dollar and ended the day at 284.42 against the dollar on the interbank market, and with a general trend of falling prices on the world’s markets.
All-Pakistan Sarafa Gems and Jewellers Association said that the price of 24 carat gold fell by Rs2,500 per tola and Rs2,142 per 10 grams to settle at Rs214,500 per tola and Rs183,900 per 10 grams.
Since the last three business days, the price of the yellow metal has been going up. This is because gold is often seen as a way to protect against inflation.
Pakistan’s monthly inflation rate hit an all-time high of 35.4% in March, compared to the same month a year earlier. People are feeling more pain from some of the fastest rising market prices, and average incomes are still not keeping up with the cost of living.
After Saudi Arabia told the International Monetary Fund (IMF) that it would deposit $2 billion in Pakistan, investors’ interest has moved to other markets. Both the rupee and stocks went up.
Riyadh’s promise will be a big help in getting Pakistan’s failed bailout program back on track. Since last year, Pakistan has been trying to get the program back on track.
The rupee-dollar parity affects the price of gold because almost all of the country’s gold needs are met by imports, and sellers set prices in the country based on the price of gold in other countries.
Before changing the price of the metal into rupees, jewelers buy it with the US dollar and the UAE dirham.
The association also said that the price of gold in Pakistan is “undercost” by Rs8,000 per tola compared to the Dubai market. This shows that the gold market in Pakistan is currently cheaper than the world market.
On the local market, silver prices stayed the same at Rs2,450 per tola and Rs2,100.48 per 10 grams.
On the foreign market, the price of an ounce of gold fell by $4 to $2,019.