Gold Prices in Pakistan Soar Amid Global Rally and Geopolitical Tensions

Safe-haven demand surges as gold climbs over 2% globally, pushing local prices up by Rs5,900 per tola.

by Zyke Network
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Gold Prices in Pakistan Surge as Global Market Reacts to Geopolitical Risks

Gold prices in Pakistan surged sharply on Monday, rebounding from weekend losses and echoing a global rally that pushed the yellow metal to its highest level in more than three weeks. The increase was driven by a weaker U.S. dollar, escalating geopolitical tensions, and heightened investor appetite for safe-haven assets.

According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), gold prices in the local market jumped by Rs5,900 per tola, reaching Rs353,100. Prices for 10 grams of gold also saw a significant uptick, rising by Rs5,058 to settle at Rs302,726.

This marks a swift reversal from the weekend, when prices had dropped by Rs1,400 per tola to close at Rs347,200 on Saturday.


Global Gold Market Surges on Weakened Dollar and Conflict Fears

Globally, spot gold rose over 2.7% to $3,377.29 an ounce — its highest level since May 8 — while U.S. gold futures climbed 2.6% to $3,402.70. The rally reflects mounting concerns about Ukraine’s renewed military activity against Russia, along with persistent economic uncertainty in major markets.

“The international gold market is showing strong upward momentum,” said Adnan Agar, Director at Interactive Commodities. “This is largely due to geopolitical developments, particularly Ukraine’s large-scale attack on Russia, which has reignited safe-haven demand.”

Agar highlighted that gold’s intraday movements ranged from a low of $3,301 to a high of $3,377, and emphasized that a close above the $3,380 mark could signal a further push toward resistance levels at $3,400, $3,420, and $3,440.


What’s Driving Gold Demand?

Several converging factors have pushed gold higher:

  • Weaker U.S. Dollar: A declining dollar makes gold more attractive to non-dollar investors.

  • Geopolitical Tensions: Renewed hostilities in Eastern Europe are stoking investor fear.

  • Global Economic Uncertainty: Persistent inflation, policy indecision, and recession concerns continue to fuel the safe-haven trade.

“If gold manages to sustain a close above $3,400, we could see a near-term test of $3,500. But that will depend on whether current risk factors persist,” Agar said.


PKR Shows Modest Strength Amid Gold Rally

Interestingly, while gold surged, the Pakistani rupee (PKR) posted a slight gain against the U.S. dollar. The interbank market saw the rupee strengthen by 0.02%, closing at Rs281.97 per USD — a five paisa improvement from Friday.

This uptick comes after a mild depreciation over the past week, where the rupee slipped from Rs282.02 to Rs282.06.

According to Ismail Iqbal Securities, the rupee has depreciated:

  • 1.23% calendar year-to-date (CYTD)

  • 1.30% fiscal year-to-date (FYTD)


What to Watch Going Forward

  • Geopolitical headlines: Any escalation in Russia-Ukraine tensions could continue to support gold prices.

  • U.S. Federal Reserve stance: If the Fed signals dovishness or a rate cut, gold could rally further.

  • Local currency trends: While modest, the rupee’s stability could help contain import-driven inflation.

With gold maintaining a bullish global outlook and safe-haven demand on the rise, investors may continue favoring the precious metal in the short to medium term — especially amid increasing volatility in other asset classes.

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