KARACHI: The price of gold in Pakistan decreased by Rs. 250 per tola and Rs. 214 per 10 grams to settle at Rs. 130,000 per tola and Rs. 111,454 per 10 grams respectively.
A day earlier, the precious commodity closed at Rs. 130,250 per tola and Rs. 111,668 per 10 grams.
Cumulatively, the safe-haven asset lost Rs. 750 or 0.57% per tola during the week ended on March 19. Meanwhile, in the international market gold extended losses recording a decline of $11 per ounce to settle at $1,921.
Globally, gold was on track for its biggest weekly drop in nearly four months on Friday, after the demand of the safe-haven metal was hit by hopes of progress in peace talks between Russia and Ukraine as well as the fallout from a US interest hike rate.
The dollar jumped against its rivals, making bullion more expensive for overseas buyers.
“We have seen the invasion-driven momentum and speculative fury (of gold) massively cool off over the past 10 days,” said David Jones, chief market strategist at Capital.com.
Bullion is down 2.8% this week as optimism over the peace talks lifted sentiment in wider financial markets, denting demand for safe-haven assets.
“If there is a ceasefire or some sort of a deal, gold could drop fairly quickly,” said Edward Meir, an analyst with ED&F Man Capital Markets.
Earlier this week, the Federal Reserve raised its benchmark overnight interest rate by a quarter of a percentage point and forecast an aggressive plan to push borrowing costs to restrictive levels next year.
Higher interest rates tend to raise the opportunity cost of holding non-interest paying gold.
Gold rates in Pakistan are around Rs. 5,500 below the cost compared to the rate in the Dubai market.
Meanwhile, silver prices in the domestic market remain unchanged at Rs. 1,500 and Rs. 1,286 today.
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