Gold price in Pakistan drops again

KARACHI: Gold price in Pakistan declined by Rs800 per tola on Monday, bringing the new price to Rs277,000, as global bullion markets witnessed a slight drop. 

The price of 10 grams of gold also fell by Rs687, settling at Rs237,482 in domestic trading. 

In the international bullion market, the price of gold dropped by $8 per ounce, reaching $2,658. This global trend trickled into local markets, prompting a downward adjustment in prices across major Sarafa bazaars. 

While gold saw a notable decrease, silver prices remained unchanged. The price per tola of silver stood firm at Rs3,400, while 10 grams of silver remained steady at Rs2,914.95. 

Local traders attributed the decline to fluctuations in the international market, which have impacted gold demand and pricing dynamics worldwide. 

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On Friday, gold price in Pakistan dropped exponentially as price per tola decreased by Rs5,000. Likewise, the price of 10-grams of gold also dropped by Rs4,286.

Earlier on Monday, the State Bank of Pakistan (SBP) cut its key policy rate by 200 basis points to 13 per cent, for a fifth straight reduction since June as the headline inflation declined to 4.9 per cent year-on-year basis in November 2024.

The new rate will be effective from December 17 (Tuesday), SBP’s Monetary Policy Committee (MPC) said in a statement.

The latest move makes this year’s cuts the most aggressive among emerging market central banks in the current easing cycle, barring outliers such as Argentina.

The MPC said that this deceleration was mainly driven by continued decline in food inflation as well as the phasing out of the impact of the hike in gas tariffs in November 2023.

However, the Committee noted that core inflation, at 9.7 per cent, is proving to be sticky, whereas inflation expectations of consumers and businesses remain volatile. To this effect, the Committee reiterated its previous assessment that inflation may remain volatile in the near term before stabilizing in the target range.