Gold prices in Pakistan moved higher on Monday, tracking a modest rise in the international market as investors kept a close watch on the conflict between the United States and Iran and its impact on global inflation.
According to the All Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold rose by Rs300 per tola to settle at Rs424,536.
The price of 10 grams of gold also increased by Rs258, reaching Rs363,971.
The latest increase follows Saturday’s sharp jump, when the price of gold climbed by Rs2,400 per tola to close at Rs424,236.
In the international market, gold gained $3 to settle at $4,021 per ounce, including a premium of $20. Spot gold was trading around $4,019 an ounce during the day, while US gold futures edged slightly higher.
Market analysts said investors are closely following developments in the Middle East, where the ongoing US-Iran conflict has raised concerns over oil supplies and inflation. Although oil prices pulled back after touching a one month high, uncertainty over shipping through the Strait of Hormuz continues to keep markets on edge.
Higher oil prices can fuel inflation, increasing expectations that the US Federal Reserve may keep interest rates elevated or even raise them further. While gold is often viewed as a safe haven during periods of uncertainty and inflation, higher interest rates can limit demand because the precious metal does not offer any yield.
Federal Reserve officials have also signalled that further rate hikes remain a possibility if inflation stays stubbornly high. Traders are now increasingly betting on another rate increase before the end of the year.
Meanwhile, silver prices also posted a strong gain in Pakistan, rising by Rs107 per tola to reach Rs6,177.
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