Gold soars to record highs of Rs348,000/tola
Gold prices continued their record-breaking surge on Wednesday, defying analysts' expectations of a market correction, as both domestic and international rates reached new all-time highs.
According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold per tola in Pakistan soared by Rs8,600 in a single day, settling at a historic high of Rs348,000. Similarly, the rate for 10 grams rose by Rs7,373 to close at Rs298,353.
The international prices for Pakistan also saw a notable jump, with gold prices climbing $86 during the day to reach a record $3,310 per ounce, inclusive of a $20 premium.
Commenting on the development, Adnan Agar, Director at Interactive Commodities, said gold continued its upward momentum, touching a record high of $3,319 before slightly retreating to $3,318. "Today's rally wasn't driven by any fresh news, particularly from the US side. Rather, it's a continuation of a multi-day bullish trend," he noted, adding that lingering concerns around the global trade war remain an underlying factor.
Agar further cautioned that while there might still be room for another $25 upside, the market is approaching technically overbought territory. "Once that threshold is hit, a correction of $100150 can be expected," he said.
On Tuesday, gold per tola had already climbed by Rs600 to close at Rs339,400, highlighting the persistent demand and bullish sentiment in the market.
Meanwhile, the Pakistani rupee posted a slight gain against the US dollar on Wednesday, appreciating by 0.04% in the inter-bank market.
By the close of trade, the rupee settled at 280.46, up by Rs0.11 from the previous day's closing rate of 280.57.
On the global front, the US dollar held onto a modest rebound, as investors paused after several weeks of heavy selling, with markets steadying ahead of further developments in US trade negotiations. Moreover, the State Bank of Pakistan (SBP) raised a total of Rs1.225 trillion through two separate auctions held on April 16, 2025.
In the Pakistan Investment Bond - Floating Rate (PFL) Semi-Annual Auction, SBP raised Rs260.83 billion, with Rs67.62 billion from 5-year bonds and Rs193.21 billion from 10-year bonds. Notably, all bids for the 2-year bonds were rejected. In the Market Treasury Bills (MTBs) Auction, SBP raised Rs964.63 billion across various tenors. The breakdown included Rs284.38 billion from 1-month bills, Rs135.02 billion from 3-month bills, Rs76.24 billion from 6-month bills, and Rs469 billion from 12-month bills.
Combining both auctions, the central bank mobilised a substantial amount to meet government financing needs, reflecting investor confidence in Pakistan's short and medium-term debt instruments.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
8 hours ago
- Business Recorder
Gold price per tola falls Rs100 in Pakistan
Gold prices in Pakistan decreased on Friday in line with their decline in the international market. In the local market, the gold price per tola reached Rs352,900 after a loss of Rs100 during the day. As per the rates shared by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), 10-gram gold was sold at Rs302,555 after it shed Rs86. On Thursday, the gold price per tola reached Rs353,000 after a loss of Rs2,000 during the day. The international rate of gold decreased today. As per APGJSA, the rate was at $3,302 per ounce (with a premium of $20), a loss of $1. Meanwhile, the silver price per tola remained stable at Rs3,900 during the day.
Business Recorder
16 hours ago
- Business Recorder
Lahore admin supplies sugar, launches crackdown against hoarders
LAHORE: The District Administration of Lahore supplied over 1,000 tonnes of sugar across the city to ensure provision of the commodity on affordable rates to the residents of the metropolis, while additional supplies continued to maintain a balanced supply chain. The administration's spokesperson clarified that there is no sugar shortage in Lahore and that efforts to create artificial scarcity have been thwarted. The administration also launched a crackdown against the hoarders and lawbreakers, with 27 individuals facing action, nine cases registered, 13 shops sealed, and fines totalling Rs450,000 were imposed against violations. The spokesperson emphasized that actions are based on solid evidence, ensuring no honest trader is unfairly targeted. DC Syed Musa Raza assured full support to law-abiding traders while maintaining that exploitation of the public will not be tolerated. The administration has urged residents to report any issues with sugar availability or overpricing immediately, with direct access to the Additional Deputy Commissioner General for swift resolution. All efforts are focused on providing relief to the public, with the administration reinforcing that the law applies equally to all. These measures have stabilized sugar prices and availability, directly benefiting Lahore's residents by ensuring a steady and affordable supply of this essential commodity. Meanwhile, the Pakistan Sugar Mills Association has said that all sugar mills are supplying sugar at Rs165 per kg ex-mill and the country has ample stocks of sugar till mid-November 2025. In a statement, a spokesman of PSMA said that sugar supply chain was affected due to divergent administrative measures taken by some government institutions which have somewhat been redressed and the supply of sugar is continuing. The sugar industry has previously clarified that all mills are supplying sugar to the domestic market at Rs165 per kg ex-mill. Mills are only concerned with the ex-mill prices while the retail price of sugar in the market is normally determined by market forces, which is now being controlled by the government. As per media reports, sugar is being sold at Rs200 per kg but according to sugar industry information, the commodity in most markets is available at the government-set price of Rs173 up to Rs175 per kg. The spokesperson clarified that sugar dealers are buying sugar from mills at Rs165 per kg ex-mill and instead of giving it to domestic consumers, they are giving it to industrial and commercial consumers at higher profits. Satta Mafia and Stockists are creating hurdles in the supply of sugar they purchased before the price was fixed. They are blaming sugar exports by creating the impression of an artificial shortage of sugar. Linking sugar prices to exports is completely against the facts. The government had allowed the export of sugar only in case of surplus sugar from the carry-over stock of the last two years that was available with the mills and further surplus sugar was produced in the crushing season of 2023-24. Mills had to sell sugar at a loss well below the cost of production while meeting the government's condition of Rs140 per kg. Before sugar exports, all official estimates had shown a strong possibility that the next crushing season would see a good sugarcane yield and produce more sugar, but due to global warming and climate change, sugarcane production and its sucrose level dropped, which adversely affected sugar production. In the previous crushing season, the sugar industry purchased sugarcane up to Rs700 per maund which was Rs425 per maund in the crushing season of 2023-24. This provided substantial benefits to the farmers, however, it led to the sugar industry's cost of making sugar increase significantly. There was also a manifold increase in other production costs, due to which sugar mills had to suffer continuous losses over the past several years and now 12 sugar mills are closed and up for sale. Baseless accusations of profiteering on the sugar industry are unjustified. All such issues would be resolved by deregulating the sugar sector at the earliest, just as happened in the case of rice and maize sectors. Copyright Business Recorder, 2025
Business Recorder
17 hours ago
- Business Recorder
SBP's over-cautious and lopsided monetary policy
In their August 2024 published article 'Understanding the international rise and fall of inflation since 2020' in the 'Journal of Monetary Economics', three writers from the Research Department of International Monetary Fund (IMF), and one other highlighted two reasons broadly that are apparently at odds with the otherwise policy prescription from both IMF through its extended fund facility (EFF) programme, and by 'Chicago boys'-styled local policymakers. Hence, while the research paper, which is based on data from 10 advanced economies and 4 emerging economies, saw broadly the role of external factors in driving up inflation, and that the secondary cause in the shape of monetary policy needed lesser usage in terms of tightening given such shocks had mostly influenced core inflation; that does not include the food and energy components, and in turn highlights the advanced impact of such shocks that have come through as secondary impacts after first influencing inflation that in turn is captured by more volatile measure of inflation in the shape of overall consumer price index (CPI). The paper points out in this regard: 'Our results strongly suggest that global drivers, especially the sharp movement in energy prices, played a dominant role in driving the international rise and fall in inflation since 2020. Local policies also played a role. First, the transmission of headline shocks to underlying inflation was shaped by local characteristics. …However, our estimates suggest that the role of relative price shocks and their pass-through into core has at this point largely faded, facilitating the convergence of inflation to target-consistent levels. The continued stability of long-term inflation expectations on average across economies is also facilitating the return of inflation to target.' It is important to note that both the IMF and the SBP remained overly cautious with regard to monetary policy stance even though nothing significant has been transmitted in terms of global oil prices – which have mostly remained low relative to the highs seen during the early phase of Russia-Ukraine conflict, and mostly stable in general over the last number of months – and tariffs that were first announced in early April, and continued to remain paused most time since then, with the likelihood of being tapered down in general for most trading partners of United States, including for Pakistan. Yet, such relative easing of inflationary impact – both evidenced from the paper cited above, for instance, and the fact that monetary tightening has already run a lot of course, squeezing immensely aggregate demand for many months – continues to be met by unwarranted caution from both IMF and SBP. Hence, in their most recent country report on Pakistan that was released in May, which indicated that 'Monetary policy should remain tight and data dependent to ensure that inflation stays moderate, within the SBP's target range', and the latest monetary policy released in July 30 by State Bank of Pakistan (SBP) also surprisingly saw 'global oil prices' as 'volatile', and 'the impact of global trade tariffs as uncertain' and, in turn, kept policy rate well above both the CPI, and core inflation rate. The most shocking part is that mainly aggregate supply related causes like 'higher than anticipated adjustment in energy prices' are also being seen by SBP as grounds for involving the role of policy rate! Such over-cautious approach by IMF and SBP has already cost the economy dearly – average economic growth over the last few years of around the population growth rate of between 2-3 percent has already pushed significant number of people below the poverty line, while absolute numbers close in close to half of the population now below it as per recent World Bank figures in this regard, while unemployment rate is running very high when compared with numbers traditionally. The extent of over-caution by SBP can be seen from the fact that while inflation during the last eight months, that is during November 2024 to June 2025 has averaged 2.6 percent, policy rate has not come down in a way as to keep positive real interest rate in any reasonable limits, which as compared with June CPI numbers stands at 7.8 percent, and at 4.1 percent for the same month when compared with core inflation (non-food, non-energy). Hence, the decision to keep policy rate unchanged at 11 percent is surprising to say the least, and to say that it should have come down considerably, and well back in time is an understatement, and that is even after factoring in the role of base effect, not to mention the primarily aggregate supply side nature of external factors, and domestic energy price adjustments. The reason it is an understatement is because policy rate should not have gone up so high in the first place in response to considerable rise in inflation in recent years – before inflation started to come down – because in developing countries like Pakistan, and especially in the wake of Covid-19 pandemic, inflation is at least equally a supply-side/fiscal phenomenon. SBP as per its January 28, 2022 amended 'State Bank of Pakistan Act, 1956' is mandated 'to achieve domestic price stability by way of regulating the monetary and credit system' as its 'primary objective', it also carries the role to see its contribution towards 'supporting the general economic policies of the Federal Government to foster development and fuller utilization of the country's productive resources.' In that sense, a question that needs a plausible answer is whether an over-cautious approach of SBP – both under over-board austerity minded successive IMF programmes in general, including the current EFF programme, and similar mindset reflected by SBP outside of these programmes as well — where it has over-utilised the instrument of policy rate at the back of wrongly seeing the over-board need to restrict aggregate demand, when clearly there is a strong footprint of aggregate supply side factors in determining inflation can be seen both traditionally, and especially in the wake of Covid-19 pandemic, and in an overall world of existential threat of climate change crisis. It can clearly be seen that the mandate of SBP is not just price stability, but it also has the secondary concern to target inflation in a way that allows economic development, and utilisation of 'country's productive resources'. Clearly, an over-board monetary austerity mindset, in turn, unnecessarily squeezing the aggregate demand and not placing enough emphasis on improving institutional factors on the aggregate supply side — like fixing economic institutional quality, and improving productive—, and allocative efficiencies of underlying organisations, and markets through bettering governance, and incentive structures, including regulation — has allowed the endeavour of price stability to unnecessarily result in excessive economic growth sacrifice, along with producing only short-term reduction in inflation, with secondary impacts feeding into inflation in terms of higher transaction costs, and greater inflationary built-up cost-push inflationary channel at the back of lack of aggregate supply-related focus. More broadly, protecting fiscal space, especially in the wake of heightened geopolitics related security, and greater climate change/SDGs/economic resilience related spending needs in recent times require lowering the debt burden for instance, and SBP's overcautious and lopsided approach to rely too much on policy rate to control inflation is not allowing it to play its role for overall economic development. In this regard, while the independence of SBP needs to be protected, yet greater say of government needs to be reflected through greater footprint of government in the monetary policy committee (MPC) of SBP, in addition to filling MPC with more broad-based economic thinking in terms of economic ideological representation; it appears the neoliberal-minded influence, both traditionally and currently, seems to be in majority in terms of most members of the committee apparently showing strong signs of following this school of thought, as reflected through the overall arguments in monetary policy statements in general, including the latest one. More perhaps could be learnt from the workings of Monetary Authority of Singapore (MAS) in this regard. A mind-set of shock therapy has not helped the economy. What is needed is adopting both macro- and micro-level initiatives in a more focused and innovative way. Excessive market power – for instance in the case of sugar sector – resulting in price gouging or, in other words, dealing with 'greedflation' or 'seller's inflation' requires adopting a more balanced aggregate demand, and supply side focus. External factors influencing inflation also need to be taken in the same balanced way. For instance, noted economist Isabella M. Weber along with her co-authors, in their (2025) published article 'Implicit coordination in sellers' inflation: How cost shocks facilitate price hikes' point towards the need to make microeconomic policy interventions at the sectoral level to deal with cost-push inflation that results from seller's inflation. The paper pointed out in this regard, 'we provide descriptive evidence in support of the hypothesis that economy-wide cost shocks function as implicit coordinators for price-making firms to hike prices, which translates supply shocks and commodity market fluctuations into price increases across sectors. In the absence of coordination, price-making firms risk losing market share when they increase prices. But economy-wide cost shocks signal to all firms that this is the moment to increase prices and thus coordinate pricing while the window of opportunity is open. If supply constraints occur in addition to cost shocks, that can further strengthen the coordination signal.' Moreover, the research paper recommended, among other things, the following: 'First, measures should be taken to reduce price volatility in critical upstream sectors to prevent economy-wide cost shocks in the first place… Greater regulation and oversight, sector investigations, and antitrust enforcement in too-essential-to-fail sectors can further help contain sharp price increases. Price controls can be an emergency measure of last resort, if other stabilization efforts fail. Second, policy measures can be implemented to impose a potential cost on firms that excessively hike prices in response to cost shocks.' This provides one way that rather than seeing an otherwise wrongly over-board role of interest rate as a policy instrument to control inflation, for instance, sector specific price controls can be adopted. Another way, as a complimentary step could be to adopt 'dual-track' pricing system as adopted by China during the 1980s, for instance. Copyright Business Recorder, 2025
