Gold prices in Pakistan rose on Wednesday, according to FXStreet data. The price reached 39,223.55 Pakistani Rupees (PKR) per gram, up from 39,184.06 PKR on Tuesday. For a tola, the cost increased to 457,495.80 PKR, up from 457,035.20 PKR the day before. FXStreet adjusts international gold prices into PKR using current exchange rates and local units of measurement. These prices are updated daily and serve as a guideline, but local rates may vary slightly. Central banks are the largest holders of gold, adding 1,136 tonnes to their reserves in 2022.

Gold as a Hedge

Gold acts as a shield against inflation and currency drops since it is not tied to any specific issuer. It usually rises when the US Dollar weakens and during times of geopolitical uncertainty. Interest rate changes can also affect its price, as a strong Dollar tends to keep prices lower. This information is for informational purposes only and does not serve as financial advice. Markets change, and investing carries risks, including the loss of principal. Always do thorough research before making investment choices. As we approach the end of 2025, gold prices are stable but conditions are shifting in its favor. The market is now anticipating rate cuts from the US Federal Reserve for the upcoming year. Historically, gold prices tend to do well right before such a rate-cutting cycle begins.

Currency Markets and Gold

The currency markets are pivotal, showing that gold prices move inversely to the dollar. The US Dollar Index (DXY) has been declining in the fourth quarter of 2025, dropping from above 105 to around 101. A weaker dollar boosts gold prices, making it cheaper for holders of other currencies. Ongoing geopolitical instability also supports gold’s value, given its safe-haven status. Global supply chain shifts and regional tensions mean investors maintain gold in their portfolios as a hedge. This ongoing demand helps prevent significant drops in gold prices. It’s important to keep an eye on central banks as they are the biggest gold buyers. Following record purchases in 2022 and 2023, official sector buying has remained strong into 2024 and 2025, with emerging market banks adding about 950 tonnes this year. This institutional interest contributes to a strong long-term trend for gold prices. For traders, increasing volatility is expected as the new year begins. It may be wise to consider buying call options to position for possible price breaks above recent highs with limited risk. The CBOE Gold Volatility Index (GVZ) is already rising from its lows, suggesting that the options market anticipates a significant movement. Create your live VT Markets account and start trading now.

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