Insights 
VT 
Gold prices in Pakistan rose on Monday, with the cost per gram increasing to 38,400.95 Pakistani Rupees (PKR) from 38,201.93 PKR on Friday. The price per tola also rose, reaching 447,896.90 PKR, up from 445,579.90 PKR the previous Friday.
FXStreet adapts international Gold prices to the local currency using the USD/PKR exchange rate. Daily updates reflect market rates at publication time, though local prices may vary slightly. The price for 10 grams is 384,006.30 PKR, while a troy ounce costs 1,194,396.00 PKR.
Gold As A Safe Haven Asset
Gold has been a historical store of value and is now a safe-haven asset during times of unrest. It serves as a hedge against inflation and currency devaluation. Central banks, especially in emerging economies like China and India, are major Gold buyers, adding 1,136 tonnes worth around $70 billion in 2022.
Gold inversely correlates with the US Dollar and US Treasuries. Its price is sensitive to geopolitical instability and recession fears. Lower interest rates can increase Gold’s appeal as a yield-less asset, while a strong Dollar tends to suppress its price.
The rise in local gold prices today reflects a broader global trend we are seeing in late 2025. Gold is acting as a hedge against currency depreciation, not just in Pakistan but in many emerging markets. This safe-haven appeal is a primary driver traders need to watch.
Central bank buying continues to provide a strong floor for the gold price, a trend we’ve seen accelerate since the record purchases back in 2022 and 2023. Recent data from the World Gold Council for the third quarter of 2025 showed that central banks, particularly from Asia, added another 280 tonnes to their reserves. This consistent demand suggests that dips in price are likely to be viewed as buying opportunities by major institutions.
The Impact Of Inflation And Interest Rates
This price action is also a reaction to persistent inflation and its effect on interest rate expectations. While inflation has cooled from the highs seen in 2023, the latest US CPI reading for October 2025 came in at a stubborn 3.1%, keeping it above the Federal Reserve’s target. This makes a non-yielding asset like gold more attractive as it preserves wealth.
The correlation with the US Dollar remains critical for traders to monitor. With recent US GDP figures for Q3 2025 showing growth slowing to 1.5%, the market is now pricing in potential Fed rate cuts in the first half of 2026. A weaker dollar, which often follows rate cut expectations, typically pushes gold prices higher.
Given these factors, derivative traders should be looking for opportunities in bullish strategies. Buying call options on gold futures or ETFs could provide upside exposure with limited risk. We believe it is crucial to watch upcoming US employment and inflation data, as any sign of further economic weakness could accelerate gold’s upward momentum.
