On Tuesday, the price of one tola of gold in Pakistan soared to a record high of Rs273,000, surpassing the previous peak of Rs272,500 set just days earlier. The yellow metal has experienced a remarkable increase of over 7% since August 1, 2024, driven primarily by fluctuations in the international gold market and the stable rupee-dollar exchange rate.
According to Muhammad Adnan Qadri, Convener of the FPCCI Central Standing Committee on Gems & Jewellery, the recent surge is largely attributed to heightened geopolitical tensions, particularly between Israel and Lebanon, which have spurred demand for gold as a safe-haven asset. The ongoing conflict in the Middle East, including Israeli strikes on Hezbollah targets and the war in Gaza that has claimed over 40,000 lives, continues to be a major global concern.
In addition to geopolitical factors, recent economic developments have also contributed to the rise in gold prices. The US Federal Reserve’s unexpected interest rate cut last week has led to increased demand for gold internationally. This rate cut, part of a broader trend of monetary easing, has raised concerns about the job market and boosted gold’s appeal.
Experts note that industrial demand for gold is also on the rise, with significant use in electric vehicles, robotics, AI, and nuclear energy. Furthermore, heavy buying from China and India is expected to influence international gold rates in the coming weeks.
However, domestically, the high gold prices have made the commodity unaffordable for many Pakistanis, leading customers to turn to silver and imitation jewelry amid record inflation that has diminished purchasing power. Experts anticipate that gold prices will remain elevated in the months ahead.
