Gold prices in Pakistan decreased on Thursday according to FXStreet data. The price per gram fell to 38,035.42 Pakistani Rupees (PKR) from 38,211.35 PKR the previous day.
The cost per tola also declined, dropping to 443,639.80 PKR from 445,689.70 PKR. The price for 10 grams was set at 380,350.10 PKR, while a troy ounce was priced at 1,183,071.00 PKR.
Calculation Of Local Prices
FXStreet adapts international prices using the USD/PKR exchange rate to calculate local gold prices, which are updated daily.
Gold is valued not only for jewellery but also as a store of value and a medium of exchange. It serves as a safe-haven asset during uncertain times and is viewed as a hedge against inflation and currency depreciation.
Central banks, especially in emerging markets like China, India, and Turkey, are the largest gold buyers, adding 1,136 tonnes in 2022.
Gold inversely correlates with the US Dollar and other major safe-haven assets. Geopolitical issues and recession fears can elevate Gold prices due to its secure financial status, impacted by interest rate changes and the strength of the Dollar.
Market Conditions
We are seeing a minor dip in gold prices, which should be viewed in the context of a weakening US Dollar. The Dollar Index (DXY) recently fell below 103, a level we have not consistently seen since the third quarter of this year. This inverse relationship suggests that the current softness in gold may present an opportunity rather than a new trend.
Expectations are building that the Federal Reserve will signal a rate cut for early 2026, especially after recent GDP growth figures for Q3 2025 came in slightly below forecast. As a non-yielding asset, gold becomes more attractive as bond yields decline, with the 10-year Treasury yield now hovering around 3.9%. This environment should provide a significant tailwind for the precious metal heading into the new year.
Central bank buying has also remained a powerful supportive factor throughout 2025, extending the record-setting trend we observed back in 2022. Reports from November show that emerging market central banks have added over 850 tonnes to their reserves year-to-date. This consistent demand from official sources creates a strong floor under the market, limiting downside risk.
For the coming weeks, we should consider strategies that benefit from potential upside volatility. Buying call options with expiration dates in February and March 2026 would position us well for a rally driven by changing interest rate expectations. Given that implied volatility is moderate, bull call spreads could also be an effective way to gain bullish exposure at a reduced cost.
However, we must remain mindful of the upcoming inflation data, which came in at a persistent 3.1% last month. If inflation proves stickier than anticipated, it could force the Federal Reserve to delay any planned rate cuts, which would strengthen the dollar and weigh on gold. Therefore, holding some protective put options could be a prudent hedge against any unexpected hawkish shifts in monetary policy.
