Pakistan’s gold rate goes down as the rupee gets stronger.
Gold prices fell in Pakistan on Friday, just like they did on the international market, and the rupee kept getting stronger against the US dollar.
All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) data showed that the price of gold (24 carats) went down by Rs2,800 per tola and Rs2,400 per 10 grammes to settle at Rs193,200 and Rs165,638, respectively.
After a big drop the day before, the price of the precious commodity had a “dead cat bounce,” or a temporary rise. However, the price went down during today’s session.
On the domestic market, however, silver prices stayed the same at Rs2,100 per tola and Rs1,800.41 per 10 grammes.
On the international market, gold fell for the third week in a row on Friday. This drop was slowed by the dollar’s rise, which was caused by more hawkish comments from US Federal Reserve officials. After a drop of $15, the price for an ounce was set at $1,824.
Two Fed officials said on Thursday that the US central bank probably should have raised interest rates more than it did earlier this month.
Based on what people said, the dollar index went up to its highest level in six weeks. This made bullion less appealing to people in other countries, and bond yields also went up.
Quantitative Commodity Research analyst Peter Fertig said that the latest comments, which put a 50-basis-point rate hike and more than one other increase back on the table, are good for the dollar and bad for precious metals markets.
Even though gold could come back, this seems unlikely and would depend on how much the central banks raise interest rates above what the markets have already priced in, Fertig said.
The opportunity cost of holding zero-yield bullion goes up when interest rates go up.