Gold prices in Pakistan stayed steady on Tuesday, according to FXStreet. The price was PKR 37,793.02 per gram, the same as PKR 37,814.54 on Monday. For a tola, the price remained at PKR 440,811.40, a slight decrease from PKR 441,061.30 the previous day. FXStreet adjusts international gold prices to local rates using the USD/PKR exchange rate. These prices are updated daily, though local rates may vary slightly. Gold has always played a vital role as a store of value and a medium of exchange. Now, it is often seen as a safe-haven asset during uncertain times and as a hedge against inflation and currency devaluation. Central banks, especially in emerging economies like China, India, and Turkey, are significant buyers, purchasing 1,136 tonnes worth $70 billion in 2022. Gold usually rises when the US Dollar falls and has an inverse relationship with US Treasuries. It often gains value when the stock market declines. Factors like geopolitical stability, interest rates, and the strength of the US Dollar influence gold prices. Generally, lower interest rates and a weaker Dollar boost gold’s value. The current stability in gold prices suggests that the metal is consolidating after its earlier gains this year. This may be a pause before the next notable movement, driven by changes in the macroeconomic environment. This low-volatility period offers a chance to prepare for what we expect to be an active first quarter of 2026. We’re closely watching the US Federal Reserve, particularly after the aggressive rate hikes throughout 2023. Recent US inflation data from November 2025 showed a cooling to 2.9%. The market is now expecting a high chance of rate cuts by the end of the first quarter of 2026. This potential drop in interest rates would make non-yielding gold a more appealing asset. Moreover, significant demand from central banks creates a strong price floor. This trend has continued since the record purchases of 1,136 tonnes in 2022. The World Gold Council’s reports for the third quarter of 2025 confirm that banks in emerging markets are still actively increasing their reserves. This consistent buying acts as a buffer against major price drops. If the Fed shifts to a dovish stance, it would likely weaken the US Dollar, which has been a challenge for gold. We saw this during a similar change in the latter half of 2024 when the Dollar Index dropped over 5%. A weaker Dollar makes gold cheaper for holders of other currencies, which should be a key factor driving gold prices in the coming months. Given this outlook, we see the current steady period as a chance to build long positions through derivatives. Buying call options that expire in March 2026 looks particularly promising since implied volatility is low compared to what we expect around the next Fed meetings. This strategy allows for significant profit potential while clearly managing downside risk.

here to set up a live account on VT Markets now