Gold prices in Pakistan fell sharply on Tuesday, tracking losses in the international market where a stronger US dollar and expectations of tighter monetary policy weighed on demand for the precious metal.
According to the All Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold per tola dropped to Rs432,236 after a decline of Rs10,400 during the day.
Similarly, the price of 10-gram gold fell by Rs9,360 to settle at Rs368,985.
The fall came after a brief upward move a day earlier. On Monday, gold had climbed to Rs442,636 per tola, gaining Rs4,643 during the session before reversing direction.
In the global market, gold prices also moved lower. The international rate slipped by $104 to $4,098 per ounce, including a $20 premium.
Silver followed the same direction. In the local market, its price dropped by Rs487 per tola to Rs6,664.
Global pressure weighs on bullion
Internationally, gold lost nearly 2 percent as the US dollar surged to its highest level in a year. Market sentiment has shifted towards expectations that the US Federal Reserve may maintain a more aggressive interest rate stance to control inflation.
Spot gold declined 1.8 percent to $4,116.07 per ounce by 0936 GMT, after touching its lowest level since June 11 earlier in the session. US gold futures for August delivery also slipped 1.6 percent to $4,133.70 per ounce.
Analysts said the stronger dollar has become the main pressure point for gold, which does not offer any yield and often struggles when interest rates rise.
ActivTrades analyst Ricardo Evangelista noted that recent signals from the US central bank have strengthened the dollar, adding pressure on gold prices.
Traders have also increased their expectations of further rate hikes, with market indicators now showing around a 68 percent probability of a September increase, compared to 29 percent previously, according to the CME FedWatch Tool.
The outlook for gold remains closely tied to US monetary policy and dollar strength, with investors watching upcoming economic signals for direction.
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