KARACHI: Gold prices declined in Pakistan on Tuesday, tracking losses in the international market as a stronger US dollar weighed on bullion.
According to rates issued by the All Pakistan Sarafa Gems and Jewellers Association, the price of 24-karat gold per tola fell by Rs1,300 to Rs422,136.
Similarly, the price of 24-karat gold per 10 grams decreased by Rs1,115 to Rs361,913.
In the international market, gold prices dropped by $13 to $3,996 per ounce, the association reported.
Silver prices also declined in the domestic market. The price of silver per tola fell by Rs85 to Rs5,793, while the price of 24-karat silver per 10 grams decreased by Rs73 to Rs4,966.
International silver prices also dropped to $53.15 per ounce, according to the association.
Stronger dollar weighs on gold
Internationally, the US dollar rose 0.3 per cent against a basket of major currencies, reaching a nearly two-week high. A stronger dollar makes gold, which is priced in US currency, more expensive for holders of other currencies, potentially reducing demand.
Despite its traditional role as a safe-haven asset, gold has faced pressure amid market volatility and uncertainty surrounding the Iran war, elevated energy prices, artificial intelligence-related technology stocks and rising government debt.
Oil rises slightly as diplomacy hopes counter renewed Houthi attacks
“Gold remains under pressure from a stronger US dollar and elevated Treasury yields, as persistent inflation concerns, driven by high oil prices, reinforce expectations that the Federal Reserve will maintain a restrictive monetary policy stance,” said Ricardo Evangelista, director and CEO of ActivTrades.
Oil prices rose on Tuesday, with Brent crude hovering around $116 a barrel, as renewed Houthi attacks on Saudi Arabia highlighted persistent supply risks in the Middle East.
Investors are also awaiting US Personal Consumption Expenditures (PCE) inflation data due on Thursday. The indicator is closely watched by the Federal Reserve as it pursues its 2 per cent inflation target.
Evangelista said a hawkish message from the Fed or stronger-than-expected PCE inflation could push gold below $4,000 per ounce, potentially towards $3,900.