- Gold price plunges Rs3,300 per tola to settle Rs181,800.
- Analysts had predicted that gold will see black-swan stumble.
- Silver prices in domestic market rise Rs30 per tola.
Gold prices pared losses on Tuesday after Pakistan received flood aid pledges worth $11 billion at the one-day International Conference on Climate Resilient Pakistan in Geneva.
The announcement of inflow pledges burst the pricing bubble of the precious metal which had previously taken advantage of the dollar shortage and rupee depreciation.
Data released by All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) showed that the price of gold plunged by Rs3,300 per tola and Rs2,829 per 10 grams to settle at Rs181,800 and Rs155,864.
Analysts had already predicted that the yellow metal will see a black-swan stumble as an inflow of $6-8 billion from multilateral and bilateral creditors will burst the pricing bubble in Pakistan.
Earlier, goldsmiths anticipated gold to touch Rs200,000 per tola due to the rupee devaluation against the US dollar under the current cycle. However, they now believe the price will fall below key level of Rs180,000 per tola.
They also mentioned that a majority of the buyers in the local market comprise gold investors these days. Earlier, they were parking their savings in the US dollar to avoid the impact of rupee devaluation at a time of high inflation.
They mentioned that the investors started moving to the bullion market following the shortfall of the dollar in the open market. In the black market, illegal traders were selling the dollar for Rs250-260 compared to Rs227 in the interbank market.
Meanwhile, silver prices in the domestic market rose Rs30 per tola and Rs25.71 per 10 grams to settle at Rs2,100 and Rs1,800.41.
In the international market, gold prices steadied near an eight-month high scaled in the last session, with cautious traders largely focusing on Federal Reserve Chair Jerome Powell’s upcoming speech for more insight into the US central bank’s rate-hike trajectory. The price settled at Rs1,876 per ounce after a rise of $5.
