Another Day, Another Record! Gold Prices Skyrocket Across PAK

Pakistan’s gold market witnessed yet another historic surge on Monday as gold prices in Pakistan soared to fresh record highs, tracking the global uptrend in bullion markets. The rally, fueled by escalating global economic uncertainty, a weakening yen, and growing speculation about U.S. interest rate cuts, has driven investors worldwide toward safe-haven assets like gold.

According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of 24K gold per tola jumped by a massive Rs. 5,400 in a single day, settling at Rs. 415,278 per tola — an all-time high in Pakistan’s history. Similarly, the price of 10 grams of gold surged by Rs. 4,629, reaching Rs. 356,033, marking one of the steepest daily increases of 2025.

Global Gold Prices Hit Record $3,940 Per Ounce

The local surge comes in tandem with an explosive rally in international gold prices, where spot gold broke through the $3,900-per-ounce barrier for the first time in history.
By 0208 GMT, spot gold was up 0.9%, trading at $3,922.28 per ounce after hitting an all-time high of $3,924.39 earlier in the session.

As per APGJSA data, the international rate — including a $20 premium — stood at $3,940 per ounce, reflecting a $54 gain in just one day. The sustained upward trajectory underscores investors’ growing appetite for gold amid volatile global financial conditions and currency market turbulence.

Factors Driving the Surge

Experts attribute the sharp rise in gold prices to a combination of macroeconomic and geopolitical factors. The U.S. government shutdown, uncertainty around Federal Reserve monetary policy, and a weakening Japanese yen have all reinforced gold’s position as a safe-haven investment.

“The ongoing fiscal instability in the United States, coupled with expectations of interest rate cuts by the Federal Reserve, is pushing investors to park their capital in stable assets like gold,” said Ahmed Naseer, a senior market analyst in Karachi. “This has created a perfect storm for a gold rally, both globally and domestically.”

Adding to the bullish sentiment, global ETF inflows have surged, while central banks — particularly in emerging economies — continue to accumulate gold as part of their foreign reserves diversification strategy.

Local Market Impact and Investor Sentiment

In Pakistan, the continued rise in gold prices is seen as both a sign of market resilience and a challenge for consumers. Jewelers in Karachi, Lahore, Islamabad, and Peshawar reported record-breaking demand from investors and traders seeking to hedge against the falling PKR-USD exchange rate and rising inflation.

Despite the high prices, jewelry retailers report that investment-grade gold bars and coins are selling briskly, as individuals increasingly view gold as a hedge against the rupee’s depreciation.

“The rupee’s pressure against the dollar and global uncertainty are making gold the preferred asset for both traders and households,” said Imran Bashir, President of the Karachi Jewellers Association. “People are moving away from real estate and stocks and investing in gold for short-term stability.”

The USD to PKR exchange rate has hovered around record highs, amplifying the impact of global gold price increases in the domestic market.

Silver Prices Also Climb

Silver prices mirrored the gold market’s bullish trend. The price of silver per tola rose by Rs. 53, reaching Rs. 4,949, while the price of 10 grams of silver climbed to Rs. 4,243, according to APGJSA data.
Market analysts note that silver’s smaller but steady gains are consistent with industrial demand recovery, especially in electronics and solar energy manufacturing.

Economic and Inflationary Outlook

The latest surge in gold prices adds pressure to Pakistan’s already fragile inflation outlook. Economists warn that the rising cost of gold could further impact consumer spending and alter household savings behavior.

The State Bank of Pakistan (SBP) has been closely monitoring commodity price movements as part of its broader inflation management strategy. With the Consumer Price Index (CPI) still elevated, the spike in gold prices could influence short-term inflationary expectations.

“While higher gold prices benefit investors, they also reflect growing uncertainty about the global economy,” said Dr. Farah Qureshi, an economist at the Pakistan Institute of Development Economics (PIDE). “If global interest rates decline as expected, gold could continue to rise, further straining import-dependent economies like Pakistan.”

Global Drivers: Weak Yen, Fed Rate Cuts, and Risk-Off Sentiment

The global rally in bullion markets has been primarily driven by currency market fluctuations and expectations of monetary easing. The Japanese yen recently hit a 34-year low against the U.S. dollar, prompting safe-haven demand from Asian investors. Meanwhile, investors are increasingly betting that the U.S. Federal Reserve could begin cutting rates by December 2025, following a series of weaker economic data releases.

This combination of factors has strengthened gold’s appeal as a store of value, especially amid geopolitical tensions and rising debt levels across major economies.

Pakistan’s Gold Market Outlook

With the wedding season approaching and the rupee showing continued weakness, traders predict that gold prices in Pakistan may remain elevated in the near term. However, analysts warn that any sharp correction in international gold markets could trigger volatility in local rates.

The APGJSA expects gold to trade between Rs. 410,000 and Rs. 420,000 per tola over the next two weeks, depending on international movements and exchange rate fluctuations.

“Unless we see a significant rebound in the rupee or a sharp fall in global prices, domestic gold rates are unlikely to drop below Rs. 400,000 per tola anytime soon,” said Mohammad Arif, a bullion trader in Lahore.

Investor Advice and Market Caution

Financial advisors recommend a cautious approach, urging retail investors to diversify portfolios rather than allocating entirely to gold. While gold offers strong protection against inflation, its rapid price surge increases the risk of short-term corrections.