Significant drop seen in gold price in Pakistan today

KARACHI: Gold price in Pakistan have seen a substantial drop on the second day of the business week, with the price of gold per tola falling by Rs 1,900. According to the Sindh Sarafa Bazaar Association, the price of gold per tola now stands at Rs 441,862, while the price for 10 grams has decreased by Rs 1,629, bringing it to Rs 378,825.

This significant reduction in gold prices comes amid ongoing fluctuations in global and domestic markets. Despite this drop, Pakistan remains heavily dependent on gold, both as a store of value and a part of cultural traditions, particularly during weddings and celebrations.

In related developments, a report by the Competition Commission of Pakistan (CCP) highlighted that the annual demand for gold in Pakistan ranges between 60 and 90 tons, valued at approximately $8 billion to $12 billion. However, more than 90 per cent of this gold trade remains undocumented, contributing to the country’s informal economy.

The CCP report also revealed that about 70 per cent of gold demand in Pakistan is tied to weddings and other cultural festivities. The country continues to rely heavily on gold imports, with Pakistan importing $17 million worth of gold in fiscal year 2024. By the end of 2025, the country’s official gold reserves are expected to total 64.76 tonnes, valued at around $9 billion.

Further findings in the report point to the potential of the Reko Diq project, which could generate an estimated $74 billion in revenue over the next 37 years. At current market prices, the project is expected to yield 17.9 million ounces of gold, worth about $54 billion, potentially making a significant contribution to Pakistan’s gold reserves in the future.

As global gold prices continue to fluctuate, the drop in domestic prices offers a unique window for gold buyers, even as the country navigates its reliance on imports and faces challenges in the formalisation of its gold market.