Despite a $6 dip on global markets to $1,936 per ounce on Friday, the one-tola gold pricing for the first time broke the Rs 200,000 level despite the rupee losing 13.7% of its value against the US dollar in the previous two days.
The one-tola pricing increased by Rs 7,000 to Rs 202,500 while the 10-gram rate increased by Rs 6,000 to Rs 173,610, according to the All Sindh Saraf Jewellers Association (ASSJA).
Mohammad Arshad, head of the All Pakistan Jewellers Manufacturers Association, told media that there was no panic purchasing, as there had been in recent months, and that investors were not offloading their bars for a profit.
He added that 0.4 grams of gold nose pins cost between Rs 7,000 and Rs 8,000, making them unaffordable for many consumers who are strapped for cash due to the sharp spike in the price of precious metals.
When questioned about the exchange rate used to determine local gold pricing, he said that if one dollar is valued at Rs 275, one tola would cost little under Rs 200,000.
With the exception of gold, which has traditionally had its values determined by the open market greenback rate, all imported raw commodities and finished goods are connected to the interbank market.
According to Samiullah Tariq of Pak Kuwait Investment and Development Company, investors have been purchasing gold more often over the past two to three months owing to improved returns, with the dollar coming in second.
While significant increases in the value of the dollar in the previous two to three years have attracted investors, historically real estate has remained the top choice for those seeking to earn handsome returns.
Gold is a precious metal that costs millions of rupees to purchase in little quantities, despite the fact that it has long been regarded as a refuge of safety. With comparison to using dollars, transactions in gold are also simple.