Mansoor Sadiq

The unprecedented increase in the value of the dollar against the Pakistani rupee has promoted people to invest in gold, WealthPK reports. The investment by traders, investors and common people in gold has led to a skyrocketing hike in the price of gold. The price of gold hit an all-time high in the country during the last couple of weeks. The price of gold per tola (11.86 grams) reached Rs210,500 in Pakistan owing to the huge investment.

The increase in the value of the dollar has led to an artificial shortage of the greenback in Pakistan. Commercial banks are not even issuing letters of credit (LCs) to firms and industries owing to the shortage of the dollar in the country. Witnessing the shortage of the dollar in the market, people have started investing their savings in gold. Investors and even common people are buying gold for investment purposes.

Commenting on soaring prices of gold, the All Pakistan Sarafa Gems Jewellers Association said that before political and economic uncertainty in the country, the US dollar was considered the most reliable and preferred asset for investors. Following the devaluation of the rupee against the dollar and a shortage of greenback in the market, investors in Pakistan have started investing their money in gold.

Muhammad Yaseen, a jeweller in Rawalpindi, told WealthPK that almost 95% of buyers of gold were reportedly investors instead of their local clients. “Following the continued devaluation of the rupee against the dollar, investors are buying gold to save their money,” he added.

He said that only wealthy families bought gold for marriages and other special occasions while most people used artificial jewellery at such festive gatherings and events. Prices of gold during the last two months increased by almost Rs57,500 per tola. The price of gold per tola on December 3, 2022, was recorded at Rs153,000, which reached Rs210,500 on January 31, 2023, in the country.

Financial experts and people associated with the gold trade said that the prices of the commodity could rise further following the devaluation of the Pakistani rupee with each passing day against the US dollar. Rana Abdul Qadoon, former president of the Jewellers Association of Rawalpindi, told WealthPK that thousands of workers associated with the jewellery business were sitting after the increase in prices of gold as people started using artificial jewellery.

He said that thousands of workers became jobless in twin cities during the last few months. “Following the mounting prices of gold, it has become a privilege for high-income families as most people now prefer artificial jewellery on special occasions,” he added.

Credit: Independent News Pakistan-WealthPk