As the price of gold dropped in the international market Friday, the safe-haven bullion’s value declined in Pakistan as well.
The rate of gold (24 carats) fell by Rs6,500 per tola and Rs5,573 per 10 grams to reach Rs230,800 and Rs197,874, respectively, according to data provided by the All Pakistan Sarafa Gems and Jewellers Association (APSGJA).
The yellow metal’s value had reached a record high on May 10 amid increased political uncertainty and violence following Pakistan Tehreek-e-Insaf (PTI) Chairman Imran Khan’s arrest.
Meanwhile, the international gold rate decreased by $33 to settle at $2,005 per ounce.
Analysts have said the international rate will continue to fluctuate during May because of uncertainty surrounding the raising of the United States debt ceiling by Congress.
Meanwhile, gold prices have been reaching new highs in Pakistan almost every other day due to a number of factors — economic and political turmoil, high inflation, and currency depreciation. People prefer to buy the yellow metal in such times as a safe investment and a hedge.
The government is yet to sign a staff-level agreement with the International Monetary Fund (IMF) for the release of a crucial economic bailout despite several months of talks, with international agencies warning that Pakistan risks default following the end of the current loan programme.
The country’s foreign exchange reserves are at a critically low level — not enough for even one month’s imports — and the rupee touched a new low of Rs300 against the US dollar on May 11.
Besides this, inflation has reached a record level and is the highest in South Asia while violent protests have been flaring up for days after the PTI chairman’s arrest.