Business

Gold retreats from historic high after massive rupee appreciation

Published

2 years ago

Farwa

Gold rate (24 carats) falls by Rs2,500 per tola.
Yellow metal is Rs8,000 per tola “undercost” in Pakistan.
Commodity breaks three-session winning streak.

Gold price in Pakistan registered losses on Thursday as the precious commodity retreated from a historic high after investors shifted focus towards riskier assets following positive economic cues in the market, breaking a three-session winning streak.

The depreciation was in line with the rupee movement — which gained ground and closed at 284.42 against the US dollar in the interbank market — and a downtrend in the global markets.

The gold rate (24 carats) fell by Rs2,500 per tola and Rs2,142 per 10 grams to settle at Rs214,500 and Rs183,900, respectively, according to the data released by All-Pakistan Sarafa Gems and Jewellers Association.

The price of the yellow metal was increasing since the last three trading sessions as gold is often hailed as a hedge against inflation.

Pakistan’s monthly inflation in March soared to an all-time high level — 35.4% — from a year earlier, with people feeling more pain from some of the fastest rising consumer prices amid straining budgets as the cost of living continues to outstrip average incomes.

Investors’ attention has now shifted to other markets as the rupee and stocks registered gains following Saudi Arabia’s assurance to the International Monetary Fund (IMF) of depositing $2 billion in Pakistan.

The assurance from Riyadh will play a major role in reviving the stalled bailout programme that Pakistan has been seeking to resume since last year.

Gold price moves in line with the rupee-dollar parity as the country meets almost all its gold demand through imports, and traders follow its international price in setting rates in the country.

Jewellers import the metal against the US dollar and UAE dirham before converting its price into rupees.

The association also mentioned that the price of gold is Rs8,000 per tola “undercost” in Pakistan, compared to the Dubai market, showing that the Pakistani gold market was currently cheaper than the global.

Meanwhile, silver prices in the domestic market remained unchanged at Rs2,450 per tola and Rs2,100.48 per 10 grams.

In the international market, gold price declined by $4 per ounce to settle at $2,019.

Business

E&P Companies Will Invest $5 Billion in Pakistan’s Petroleum Industry

Published

11 hours ago

Farwa

Over the next three years, local and foreign companies involved in Pakistan’s oil and gas exploration and production sector have shown a strong desire to invest more than $5 billion in the nation’s energy sector.

Recent changes to the Petroleum Policy and the implementation of an exclusive tight gas policy, which provide better incentives and a more investor-friendly regulatory framework, are credited with the increase in investor confidence.

These strategic changes are expected to boost domestic energy production, open up new avenues for growth, and draw large amounts of both domestic and foreign investment.

Business

With inflation slowing, the SBP is anticipated to lower the policy rate for the eighth time in a row.

Published

12 hours ago

Farwa

Businesspeople anticipate another reduction in the policy rate when the State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) releases the updated rate.

The interest rate for the upcoming two months will be announced by the central bank. It is still unclear if the rate will stay the same or be lowered to reflect stakeholder expectations.

According to experts, the policy rate will be lowered in order to further boost the nation’s economic sector.

Interest rates may be lowered for the seventh time in a row if the inflation rate declines significantly more than anticipated.

In its last six sessions, the MPC had cut the policy rate by 10 percent. In January 2025, it decreased the rate by one percent to 12pc.

12PC POLICY RATE

In January, the State Bank of Pakistan (SBP) announced cut in key policy rate by 100 basis points (bps) to 12 percent from 13pc in line with expectations of the business community.

The policy rate, which had been at 22 percent since June 2024, was slashed by 1,000 basis points to 12 percent.

The SBP governor said the decision was taken with careful consideration. “Although inflation is expected to decline next month (February), core inflation remains a pressing concern,” he stated.

Ahmed highlighted strong remittance inflows and robust export growth as key factors supporting the current account.