Gold is considered as an ideal investment option by the Pakistani investors due to its high reliability and safe haven asset capabilities. 1 tola gold price in Pakistan has showed a rise in last few years . It has been observed that political uncertainty and economic collapse has really helped this precious metal. Therefore, more and more people are planning to invest in it and thus increasing 1 tola gold price in Pakistan.

If you are also a gold investor and aiming to earn big, then keep reading as we will also identify factors that could affect 1 tola gold price in Pakistan in upcoming weeks.

1.   High U.S Interest Rates will Raise 1 tola gold price in Pakistan

Gold prices in Asian trading experienced a slight increase, bouncing back somewhat from significant losses in the previous weeks. The focus remained on forthcoming U.S. inflation data to gauge potential impacts on interest rates.

Although gold showed some strength last week, it remained considerably below the peak levels reached in April, as traders leaned towards the dollar amidst concerns about prolonged high U.S. rates.

The market awaited U.S. producer price index data scheduled for later on Tuesday, and the consumer price index reading due on Wednesday. These figures were anticipated to influence perceptions of U.S. interest rates, particularly after elevated inflation figures in the first quarter led to a reduction in expectations for interest rate cuts this year.

Persistently high interest rates are detrimental to gold as they elevate the opportunity cost of investing in the metal.

Hence , it is anticipated that 1 tola gold price in Pakistan will also rise in next few weeks due to international geo-political uncertainty and high U.S interest rates.

2.   Stable Rupee will Decrease 1 tola gold price in Pakistan

Pakistani rupee is showing a stability for last few months and now currently hovering around Rs 277 to Rs 280. Experts believe that the currency showing a good health due to improved supply of US dollar in the open market. The currency has continuously augmented 10.49%, or Rs29.16, in the last 6 and half months as compared to the record low closing at Rs307.10/$ reached in the initial few days of the September 2023.

The stable rupee is due to the deadline extension for currency exchange organizations for the US dollars import, alongside the major global currencies export till June 30, 2024 right from December 31, 2023.

Some currency exchangers are little optimistic and expect that rupee can strengthen more to Rs250-260/$ in the next few months in spite of the increasing trade deficit in March.

Gold experts believe that this currency appreciation is not good for the bullion market and will decrease the 1 tola gold price in Pakistan. However, future holds good for bullion market as Pakistani rupee will certainly depreciate due to imports pressure in the upcoming week.

3.         Political Uncertainty can be good for 1 Tola Gold price in Pakistan

The latest report by IMF has ran alarm bells in the ears of experts as it has gave a warning that Pakistan’s high economic and political  uncertainty along with emergence of latest societal  tensions can affect economic stabilizing regulations in the cash-strapped Pakistan .Various economic dangers are extremely high for the country ,however Shabaz Sharif administration  has shown its wish to  the SBAs (standby arrangement) regulations , the political uncertainty still remains  vital .Pakistan has avoided a  sovereign debt default past year and some expert believe that economy is on right path but political uncertainty can affect the stabilization programs of the current regime.

IMF officials are also going to  visit Pakistan in the current month to discuss a new debt package . Here the Shehbaz administration is going to get a $6 billion to request an extra funding .In the meantime, the IMF has painted a bad picture of the global economy but noted that it is slowly recovering. Expert believe that, it the best time for the gold investors as they can certainly benefit from this situation by raising their gold investments during high inflation and economic recession.

4.   High Inflationary Trends Will Increase 1 Tola Gold Price in Pakistan

The Pakistani economy is now quite stable especially after the completion of the previous IMF package along with inflation in control at 17% in last month from a record 38% in May previous year. The state bank of Pakistan has released a report on Pakistan inflation rate and it shows that rate is to remain between 20-20% during the year 2024. It is goof sign for the economy but still it is quite high as it would affect the long term purchasing power of Pakistani citizens.

Gold experts believe that 1 tola gold price in Pakistan will rise in next few days due to high inflation in the country. Since, high inflation forces investors to invest in the safe haven gold.

Final Words

Precious metals such as gold offer significant advantages, particularly during periods of political uncertainty and economic instability. They serve as a robust safeguard against economic downturns, notably in nations like Pakistan. The recent increase in the price of 1 tola gold in Pakistan has proven beneficial for investors, enabling them to optimize returns on their investment portfolios. Additionally, incorporating gold into a diversified portfolio strategy can be advantageous. Nonetheless, it’s crucial for investors to seek expert advice before entering the potentially volatile realm.