How FXStreet Calculates Local Gold Prices
FXStreet derives local gold prices by converting international prices using the USD/PKR rate and local units. The figures are updated daily using market rates at the time of publication, and local rates may vary slightly. Gold has been used historically as a store of value and a medium of exchange. It is also used in jewellery and is often viewed as a hedge against inflation and currency weakness. Central banks hold the most gold and may buy it to diversify reserves. Central banks added 1,136 tonnes of gold worth around $70 billion in 2022, the highest annual purchase on record. Gold often moves inversely to the US Dollar and US Treasuries, and can also be inversely linked to risk assets. Prices can be affected by geopolitical events, recession fears, interest rates, and US Dollar movements.Safe Haven Demand And Market Drivers
An automation tool was used to create the post. Gold is widely seen as a safe-haven asset, which is especially important during turbulent times. Given the recent increase in geopolitical tensions in the South China Sea, we are reminded of its value as a store of value, much like we observed during the supply chain shocks of 2025. Derivative traders should be watching for signs that this instability could escalate, potentially driving a flight to safety. The inverse correlation with the US Dollar remains a key driver for the price of gold. The US Dollar Index (DXY) has recently softened to around 102.5 as the Federal Reserve has signaled a pause on interest rate adjustments for the near future. This shift away from the restrictive monetary policy that characterized last year makes holding a non-yielding asset like gold more attractive. We also see gold as a hedge against inflation, which, while lower, remains persistent with the latest CPI figures showing an annual rate of 2.8%. Looking back at the historical data, we see central banks continued the heavy buying trend from 2022, adding over 800 tonnes in 2025 according to World Gold Council reports. This consistent institutional demand provides a solid price floor. The relationship with risk assets is also critical, as a rally in the stock market tends to weaken gold. However, with the S&P 500 showing signs of stalling after a strong first quarter, any significant equity sell-off could benefit the precious metal. In this environment, traders might consider strategies like buying call options on major gold ETFs to position for potential upside in the coming weeks. Create your live VT Markets account and start trading now.
Start trading now – Click here to create your real VT Markets account
