Gold prices in Pakistan saw a decline on Thursday, with the price of 24-karat gold dropping to Rs287,200 per tola, reflecting a Rs700 decrease. The Karachi Sarafa Association also reported a decrease in the 24-karat gold price per 10-gram, settling at Rs246,228, down by Rs600. Meanwhile, the price of 22-karat gold followed suit, dropping to Rs225,709 per 10-gram.
While gold prices decreased, silver prices rose in the domestic market. The price of 24-karat silver increased to Rs3,450 per tola (+Rs100) and Rs2,958 per 10-gram (+Rs86). This divergence reflects both local and global trends affecting precious metal markets.
Global Gold Market Under Pressure Due to US Economic Indicators
On the global front, spot gold traded near $2,779 per ounce, down $5.7 or 0.21% from the previous session. Analysts attribute the decline in gold prices to rising US Treasury bond yields and economic indicators suggesting a resilient US labor market. The Automatic Data Processing (ADP) report released Wednesday showed a substantial increase in private-sector jobs, with employers adding 233,000 new jobs in October—surpassing the previous month’s upwardly revised 159,000 and exceeding market expectations.
In addition to a strong labor market, the US Bureau of Economic Analysis reported a 2.8% growth rate in the third quarter. These robust economic indicators have reduced expectations of aggressive interest rate cuts by the Federal Reserve, leading to increased demand for US dollars and exerting downward pressure on gold prices.
Market Sentiment Ahead of Key Economic Data Releases
The gold market is also responding cautiously to upcoming US economic reports, including Thursday’s Personal Consumption Expenditure (PCE) Price Index and Friday’s Nonfarm Payrolls (NFP) report. These data points will likely provide further clarity on the Federal Reserve’s interest rate policy and influence gold prices.
The market is closely watching the Fed’s upcoming decision, particularly amid signs of persistent inflation and deficit-spending concerns. These factors have driven the yield on 10-year US government bonds close to a 4.3% high, bolstering the dollar and challenging gold’s status as a hedge against inflation.
Uncertain Global Landscape: Impact on Precious Metal Prices
Amid mixed signals from economic data, geopolitical tensions, such as those surrounding the Middle East and uncertainty ahead of the US presidential election, continue to create risk-off sentiment. As a result, gold’s demand as a safe-haven asset remains somewhat intact, although the price faces short-term pressures due to broader economic forces.
Technical Analysis: Gold Price Outlook
Technically, gold prices remain within an upward trend from the August low, despite hitting overbought levels on the Relative Strength Index (RSI) in daily charts. Analysts suggest that if gold breaks above the $2,800 resistance, it may signal a new bullish phase. However, a pullback to support regions between $2,750-$2,730 could stabilize prices if the metal faces further downward pressure.
In conclusion, gold’s price trajectory remains influenced by a mix of robust US economic data, expectations around Fed policy, and international political dynamics. As investors brace for upcoming economic reports, the metal’s future direction will likely depend on the balance between safe-haven demand and the impact of rising bond yields.
