KARACHI: Domestic gold prices reached another all-time high on Monday, with 10-gram priced at Rs356,033 and one-tola at Rs415,278 — up by Rs4,629 and Rs5,400, respectively — driven by continued increases in global gold markets.

According to the All Pakistan Sarafa Gems and Jewellers Association (APSGJA), international gold prices rose sharply to a record $3,940 per ounce, up by $54 in a single day.

Reports in international media attribute the rally to a combination of factors, including fears of a United States government shutdown, geopolitical tensions, expectations of a further rate cut by the US Federal Reserve, and political instability in France and Japan. These developments have led investors to seek safety in gold.

APSGJA General Secretary Hamza Shikarpuri noted that domestic demand for jewellery has declined sharply as high prices have made gold unaffordable for most buyers. “Families interested in buying jewellery are now bringing in old sets and bars for exchange, as purchasing new items is out of reach for many,” he said.

One-tola rate surges to Rs415,278

He added that affluent investors from sectors such as real estate and stock trading are turning to gold as a secure investment. “The 10-tola biscuit remains the most popular among large investors, while one to five-tola bars attract interest from small to medium-scale investors,” he said.

Mr Shikarpuri claimed that despite the surge in international prices, local rates remain undervalued by Rs17,000–18,000 per tola compared to global parity, due to subdued domestic demand. He said that had local prices fully aligned with international rates, the tola price would have exceeded Rs430,000.

The APSGJA official also pointed to the ongoing crackdown by the Federal Board of Revenue (FBR) and the Federal Investigation Agency (FIA) as a reason for slowing market activity. “The FBR seems more focused on extracting higher taxes from gold traders, which is discouraging trade in the sector,” he said.

He noted that any easing in global tensions could lead to a correction in gold prices, but until then, volatility is expected to continue.

Published in Dawn, October 7th, 2025