KARACHI: The domestic price of gold on Friday surged to an all-time high of Rs187,414 per 10-gram and Rs218,600 per tola with an increase of Rs943 and Rs1,100, respectively.

Pakistani rupee’s depreciation against the US dollar coupled with an increase of $7 per ounce to $2,034 in the world market were the main reasons behind the skyrocketing value of the yellow metal.

All Pakistan Jewellers Man­u­fact­urers Association President Moham­mad Arshad said the unprecedented gold prices have swept the buyers away from the market who are more concerned about the rising cost of living amid skyrocketing food, petroleum and electricity bills.

“We are almost sitting idle during a peak-buying time when the marriage season is about to kick off from the second day of Eid,” he said, adding that people are compelled to focus on artificial jewellery sets and silver ornaments.

It has been observed that over the same period every year, ahead of Eidul Fitr, the sales of jewellery sets touch peak for the post-Eid marriage season, however, the local jewellers complained that the thin footfall of the consumers at their shops due to the all-time high inflation and crashing economy is causing anxiety among them.

Mr Arshad said silver prices are also on a record high peak, however, in silver, “buyers do not get any handsome return.”

He added that it is hard for many people to buy even a five-gram gold item like gold chain, nose pin, ring, etc which cost over Rs100,000. As a result, people have begun switching over to artificial jewellery sets whose prices have also jumped to a record high due to rising demand.

“The markets have only 10 per cent of gold buyers,” he claimed. Another reason for jewellery’s low sales is mobile phones snatching, looting of shops and other street crimes prevailing in Karachi, which has caused fear among the people, he added.

President Pakistan Gem and Jewell­ery Traders and Exporters Association, Habib ur Rahman said gold is being sold between Rs3,000-Rs4,000 per tola in Pakistan compared with Dubai.

He claimed that “sales of jewellery sets are down due to a massive price hike in yellow metal.”

Mr Habib said “people are not investing in gold due to the upward rally in yellow metal’s price. They are more interested in parking their money in banks for better returns due to rising interest rates.”

There has been a tradition among Punjab growers to lift gold after good harvest of wheat and cotton crops, but for the last one month, gold demand from this segment has remained subdued due to low crop prospects of wheat and cotton.

While interest rates are crawling up in various countries, he said the world bullion market has been fluctuating due to the falling dollar in various markets and rising trend of investment in crypto currency, adding that the demand for Pakistani jewellery is still going good in foreign markets.

Published in Dawn, April 15th, 2023