Gold prices in Pakistan slipped on Monday, based on FXStreet data. The metal was priced at PKR 38,554.91 per gram, down from PKR 38,653.68 on Friday, while the per tola rate eased to PKR 449,673.60 versus PKR 450,848.90. FXStreet’s table also puts gold at PKR 385,527.80 for 10 grams and PKR 1,199,192.00 per troy ounce.
The figures are derived by converting international bullion prices via the USD/PKR rate into local units, with daily updates taken at the time of publication; FXStreet says the prices are indicative and may differ from local market quotes. Separately, central banks were cited as the largest holders of gold, adding 1,136 tonnes worth about $70 billion in 2022, according to the World Gold Council.
Short-Term Dip as a Potential Buying Opportunity
We are currently witnessing a slight dip in gold prices, with rates in Pakistan easing to 449,673 PKR per tola today. For derivative traders, this short-term pullback represents a strong buying opportunity rather than a reason to worry. Historically, August often presents seasonal lows before gold begins its traditional autumn rally, making now the time to scale into long positions.
We should keep a close eye on the US Dollar Index, which is currently testing key support levels around 101.8, as any breakdown will spark a sharp rise in gold. With major central banks expected to cut interest rates in the coming weeks, the cost of holding this non-yielding asset is falling. We suggest using bull call spreads on gold futures to capture this upside while strictly managing our risk.
Institutional Demand and Currency Volatility as Market Drivers
Institutional buying provides a massive safety net, as global central banks purchased over 1,100 tonnes of gold last year to diversify away from USD dominance. This strong demand from emerging giants like China and India will likely keep a firm floor under global prices. Because of this, we believe shorting gold during these brief dips is highly risky and should be avoided.
Additionally, local currency volatility remains high, with gold priced at over 1.19 million PKR per troy ounce due to currency depreciation. Derivative traders can use this weakness to hedge their portfolios by purchasing call options that expire in September 2026. This strategy allows us to benefit from both rising global gold prices and a weaker local currency.
