KARACHI: Gold prices in both international and local markets surged to record highs on Monday, driven by expectations of further US interest rate cuts and rising demand for safe-haven assets amid global uncertainty.

According to the All Pakistan Sarafa Gems and Jewellers Association (APSGJA), the international gold price rose by $34 to reach $3,719 per ounce. In the domestic market, the price of 10 grams (24kt) increased by Rs2,915 to Rs337,534, while one tola rose by Rs3,400 to Rs393,700.

Silver also followed the upward trend. The domestic rates for 10 grams and one tola (24kt) climbed to Rs3,939 and Rs4,595 respectively, reflecting increases of Rs54 and Rs63. The international silver price stood at $43.68 per ounce.

Gold dealers attributed the sharp rise to global developments, citing recent international media reports. The US Federal Reserve last week cut its benchmark interest rate by 25 basis points — its first reduction since December — triggering speculation about further easing, which typically supports gold prices.

Traders said geopolitical tensions and political uncertainty continue to fuel investor interest in precious metals, pushing prices higher. While gold remains attractive to investors, they noted that rising prices have discouraged retail jewellery buyers in Pakistan.

Yellow metal jumps to Rs393,700 per tola amid global rate cut signals

“Genuine buyers, particularly families preparing for weddings, are finding gold increasingly unaffordable,” said one dealer. “Most buyers are either selling old jewellery or converting it into lighter, modern designs.”

He added that some customers are still purchasing small quantities, typically between 50 to 100 grams, to make new sets. However, the surge in prices, combined with the rising cost of living, has significantly reduced purchasing power and overall demand for new jewellery.

Dealers observed that investor activity in the local gold market is increasing, as many view gold as a hedge against inflation and economic instability. The speculative interest in gold, both globally and domestically, is expected to keep prices volatile in the near term.

Published in Dawn, September 23rd, 2025