On February 1st, the Pakistani rupee saw a decrease of 8 percent in its value against the US dollar due to a decrease in demand and international prices of gold. According to figures shared by the All Pakistan Jewellers and Goldsmiths Association, the price of gold per tola declined from its highest level of Rs. 210,500 on January 30 to Rs. 194,100 on February 7. A decrease of 2000 rupees was seen in the price of gold in the last two days.
Earlier this month, market analysts had imposed a requirement for an increase in the prices of gold in terms of rupees due to the inflationary pressures. Haroon Chan, the CEO of the APJGA, stated that the gold market has been stabilized to a certain degree but it still has not reached the level of jewelry demand. Gold traders have a negative short-term outlook for the price of gold but expect it to rise in the long-term.
The decrease in the local price of gold is in line with its international price, which stood at $1,811 per ounce on February 1. The public’s trust in the local currency has been weakened as people are turning to foreign currency to buy gold. The State Bank of Pakistan imposed restrictions on the sale of foreign currency to the public after lifting the restrictions.
The market has been stabilized by the expectation of the re-launch of the IMF program and the arrival of $7 billion from China. Adnan Agr, Director of the AAGC, stated that the price of gold may remain stable for a short period of time but he expects to see a further decrease in the value of the rupee and an increase in the prices of gold after a certain period of time.
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