Despite the price of gold remaining stable in the international market, the precious metal’s value reached a record high in Pakistan on Wednesday.
The price of gold (24 carats) rose by Rs450 per tola and Rs386 per 10 grams to reach Rs218,650 and Rs187,457, respectively, according to the All Pakistan Sarafa Gems and Jewellers Association (APSGJA).
Gold had reached a previous record high of Rs218,600 per tola on April 14. It declined afterwards in line with developments in the international market before rising again.
The price of gold has risen sharply recently on the back of a weakened rupee and soaring inflation. During times of economic turmoil, people prefer to buy gold as a hedge against inflation and the rupee’s devaluation.
The rupee had fallen to an all-time low of Rs288.43 against the US dollar in the interbank market on April 11. While it has recovered since then, the US dollar continues to trade above Rs280.
The rupee gained Re0.08 or 0.03% to settle at Rs283.89 per dollar in the interbank market on Wednesday.
Another reason for the increased gold demand is the delay in an agreement with the International Monetary Fund (IMF) for a desperately needed economic bailout.
The delay in the revival of the IMF programme negatively impacts the currency market which, in turn, bolsters the demand for gold.
The price of gold in the international market remained unchanged at $2,000 per ounce.
According to the data shared by the association, the price of silver in the domestic market also reached a record high. The rate of silver increased by Rs40 per tola and Rs33.36 per 10 grams to reach Rs2,570 and Rs2,203.36, respectively.