Will latest drop in global gold prices influence rates in Pakistan?

Gold prices edged lower on Wednesday as a rebound in the US dollar and profit-booking put a pause on the recent rally that pushed bullion to near three-week highs. Spot gold fell 0.5 percent to $4,107.41 per ounce, while US December gold futures dipped 0.1 percent to $4,113.80 per ounce.

Analysts said the pullback reflects normal market corrections after a strong rally fueled by expectations of interest rate cuts by the Federal Reserve next month. “Gold and silver have been benefiting from dollar weakness this week, but Wednesday’s dip shows the market adjusting after recent gains,” said Tim Waterer, Chief Market Analyst at KCM Trade.

The US dollar index rose 0.1 percent, snapping a five-session losing streak and making gold less attractive to holders of other currencies. Meanwhile, traders are pricing in about a 68 percent chance of a 25-basis-point rate cut by the Fed in December, up from 64 percent in the previous session. Fed Governor Stephen Miran recently said a 50-basis-point cut could be appropriate as inflation falls and unemployment edges higher.

Global economic developments have also shaped sentiment. The US Senate approved a funding deal on Monday after a record-long government shutdown disrupted food benefits, left federal workers unpaid, and delayed key economic data.

Gold price in Pakistan

In Pakistan, gold prices remain elevated despite the international pullback. According to the All-Pakistan Gems and Jewellers Sarafa Association, gold jumped by Rs5,900 per tola on Tuesday, reaching Rs435,762. The price of 10 grams rose by Rs5,065 to Rs373,595. On Monday, gold had already surged by Rs7,400 per tola, marking a total increase of Rs13,300 since the start of the week.

Analysts expect today’s session to reflect the slight international dip, though local prices are likely to stay high given the momentum from earlier gains.

Other precious metals also moved lower on Wednesday, with silver falling 0.4 percent to $51.05 per ounce, platinum down 0.4 percent at $1,578.95, and palladium dropping nearly 1 percent to $1,431.47.