LAHORE: Gold prices staged a modest recovery on Wednesday after a sharp two-day decline, strengthening across global markets and Pakistan. The international bullion price rose by $35 per ounce, settling at $3,975 and edging closer once again to the $4,000 mark.
The rise filtered quickly into domestic markets. According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of 24-carat gold in Pakistan climbed by Rs3,500 per tola to Rs419,862 (approximately $1,500), while 10 grams increased by Rs3,000 to Rs359,963 (around $1,286).
The rebound followed steep losses earlier in the week, when prices dropped Rs14,000 per tola, tracking declines in international markets amid caution ahead of the US Federal Reserve’s policy signal and easing US-China trade tensions.
On Tuesday, domestic prices had fallen to Rs416,362 per tola (about $1,487) and Rs356,963 per 10 grams (around $1,275), marking one of the sharpest short-term corrections in recent months.
In the global market, gold briefly touched a three-week low of $3,886 per ounce before recovering. Ahsan Naeem, Chief Operating Officer at Floret Capitals, told Pakistan TV Digital the metal had been “under pressure from heavy selling in recent days.”
However, he emphasized the downturn appeared temporary, noting: “Around $4,400, gold was clearly overbought, so this pullback looks healthy rather than alarming.”
Strongest asset
Despite recent volatility, gold remains one of the strongest-performing assets of 2025. The metal has surged from around $2,650 in January to above $4,000 by mid-October, an increase of nearly 57%. Prices peaked at $4,381 per ounce on Oct. 20, driven by fears of geopolitical conflict, persistent inflation, and the risk of a global recession.
Local prices moved in tandem, rising to nearly Rs470,000 per tola (about $1,679) at their peak. Even after cooling, gold remains 50%-60% higher year-on-year, positioning 2025 to potentially be its strongest year since 1979.
In Pakistan, the demand trend remains mixed. Faizan Hanif, Director of Sales at Hanif Jewellers, said demand is “surprisingly strong” despite record-high prices:
“People are still buying gold as a hedge against rupee depreciation and inflation. With real estate stagnating, gold offers both liquidity and strong returns.”
But others report buyers are losing purchasing power. Mubashar, CEO of Mubashar Jewellers, noted:
“Most customers are exchanging old jewellery for new designs rather than buying fresh pieces. Affordability has really dropped, and many are turning to artificial jewellery as a cheaper alternative.”
Economists say the sustained rally signals deeper shifts in household saving behavior. Farhat Mahmood, Assistant Professor at the Pakistan Institute of Development Economics, said rising gold purchases reflect “persistently high inflation expectations and negative real yields,” prompting households and businesses to hold more tangible assets.
She suggested the government introduce sovereign-backed gold financial products, including Gold Exchange Traded Funds and Sovereign Gold Bonds, noting that such instruments would “offer safer, regulated options while supporting financial inclusion and mobilizing domestic savings.”
For now, jewellers and investors alike continue to watch price charts closely.
