KARACHI: Despite no significant change in the international market, gold prices in Pakistan witnessed the highest-ever single-day hike of Rs9,900 and Rs8,487 in one-tola and 10-gram rates, respectively, on Wednesday.

All Sindh Saraf Jewellers Association announced that the one-tola and 10-gram of gold hit an all-time high of Rs240,000 and Rs205,761, while the yellow metal rate remained unchanged at $2,031 per ounce on the world markets.

Since the beginning of the current year, consumers have witnessed a meteoric rise in rates for one-tola and 10-gram, increasing by Rs52,800 and Rs45,267, respectively, while the world gold price has swelled by $207 per ounce.

On Jan 1, the rates for one-tola, 10-gram, and the international market were Rs187,200, Rs160,494, and $1,824 per ounce, respectively.

On Wednesday, the Pakistani rupee hit a record low against the dollar in the interbank market, closing at Rs290.22, down by 1.85pc or Rs5.38 from Tuesday. Domestic gold prices are determined by daily fluctuations in the international price and the rupee-dollar exchange rate.

Mohammad Arshad, Chairman of the All Pakistan Jewellers Manufacturers Association (APJMA), said: “Both the satta mafia and investors have become active in purchasing 10-tola gold bars due to market panic surrounding the future political and economic situations following the arrest of former Prime Minister Imran Khan on Tuesday. Investors are even booking gold bars at this peak rate.”

On the contrary, he claimed that jewellery sales have remained at only 10pc amid an ongoing marriage season after Eidul Fitr.

“Many people are unable to afford the yellow metal at record high rates and this is one of the main reasons for lacklustre jewellery buying,” he added.

“Gold rates are fast entering into the luxury category, which include precious stones like diamonds, emerald and gems. It will be a challenging task for the middle- and upper-middle-class to afford gold jewellery in the future,” he said.

Mohammad Sohail, CEO of Topline Securities, said: “Some investors are buying gold due to massive rupee depreciation and deepening political noise.”

Fahad Rauf, Head of Research at Ismail Iqbal Securities, said: “Investors rush towards gold amid growing political and financial uncertainty as it is considered a safe haven.”

Published in Dawn, May 11th, 2023