Surge in gold prices amid Trump tariff turmoil dulls Pakistani wedding season demand
In recent weeks, gold has globally offered investors a safe haven from the chaos that has enveloped many financial markets since Trump's tariff announcements on April 2. But at the same time, it has dampened consumption during the wedding season in Pakistan, as buyers and jewelers feel the brunt of high prices, with one tola, or nearly 12 grams, costing about Rs348,700 ($1,200). The average monthly income in Pakistan, meanwhile, is roughly Rs70,000 ($248).
'We can see that gold is hovering around an all-time high,' Kamal Ahmed, a commodities analyst at AKD Securities, told Arab News, adding that gold prices in Pakistan had surged 38 percent since the beginning of the year.
The increase, he said, was triggered by geopolitical tensions, the Russia-Ukraine war and macroeconomic uncertainty worsened by the latest US trade actions.
'When there is uncertainty in the economy, when there is uncertainty in the geopolitical situation, people like to invest in gold,' Ahmed explained, adding that central banks around the world had also bought 'a lot of gold' recently to hedge against a possible tariff-driven recession.
In international markets, gold touched a record $3,500 per ounce, about 28.35 grams, on April 22, pushing local prices in Pakistan to fresh highs.
Analysts suggest more pain ahead.
'I think gold might test $3,800 per ounce this year, and if it breaches that level, you could see $4,500 per ounce by the end of 2025,' said Ahmed.
Global brokerage firm JP Morgan has also predicted gold could rise beyond $4,000 per ounce next year, warning of growing recession risks tied to inflated US tariffs.
The impact on Pakistan, on a tricky path to economic recovery under a $7 billion IMF bailout program, could be severe.
'Investors would prefer to buy gold than invest in equities because they seek a very safe option,' said Ahmed.
For now, the math is simple: If Trump continues his trade war against China, and increases tariffs from the 10 percent base on other countries after his 90-day pause, then it's likely that gold will continue to rally. But if a compromise with Beijing is worked out that allows both parties to save face, and other countries reach deals with Trump that largely preserve global trade, then the case for gold looks less secure.
On Monday, gold retreated as easing US-China trade tensions boosted investors' risk appetite and dented demand for safe-haven assets such as bullion, while a stronger dollar also piled on the pressure.
In the domestic market, the price of 24-karat gold per tola fell by Rs3,300 on Monday, bringing it down to Rs348,700 ($1,200). The price of 10 grams of 24-karat gold also saw a decrease of Rs2,833, settling at Rs298,950 ($1,063).
But prices are still too high for most consumers and are dampening the spring/early summer wedding season in Pakistan, where gold is an intrinsic part of celebrations.
At a jeweler's shop in Karachi's oldest Sarafa Bazaar, Fatima, a housewife who only gave her first name, stared last week at rows of glittering gold sets she could no longer afford.
'I was buying gold for my daughter's wedding that we have delayed for now because the prices of gold are very high,' Fatima said. 'You either don't give gold to your children at all or delay the marriage.'
She said she hoped prices might ease after Eid Al-Adha in June.
'The prevailing rates have made gold unreachable for the poor,' M. Iqbal, director of the All Pakistan Sarafa Gems & Jewelers Association, said, estimating that about 65 percent of traders in the gold market were actively buying, further driving up demand and prices.
'It's risen beyond their purchasing power now. Gold has become an investor's business only.'
He warned that if the tariff war dragged on, gold prices in Pakistan could swell beyond Rs500,000 ($1,780) per tola.
'People are managing their weddings by purchasing lesser quantities of gold,' Iqbal warned. 'People who used to buy two or more tolas are now purchasing only half of it, and that too because it's a tradition.'
Muhammad Yaqoob Ishaq, a jeweler whose family has traded gold for more than a century, said many customers were now opting for artificial jewelry.
'Nowadays artificial jewelry is trending in weddings,' he said. 'People have been buying artificial jewelry or using silver ornaments that are gold coated.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Al Arabiya
2 hours ago
- Al Arabiya
The Tea app was intended to help women date safely. Then it got hacked
Tea, a provocative dating app designed to let women anonymously ask or warn each other about men they'd encountered, rocketed to the top spot on the US Apple App Store this week. On Friday, the company behind the app confirmed it had been hacked: Thousands of images, including selfies, were leaked online. 'We have engaged third-party cybersecurity experts and are working around the clock to secure our systems,' San Francisco-based Tea Dating Advice Inc. said in a statement. The app and the breach highlight the fraught nature of seeking romance in the age of social media. Here's what to know: Tea was meant to help women date safely. Tea founder Sean Cook, a software engineer who previously worked at Salesforce and Shutterfly, says on the app's website that he founded the company in 2022 after witnessing his own mother's terrifying experiences. Cook said they included unknowingly dating men with criminal records and being catfished – deceived by men using false identities. Tea markets itself as a safe way for women to anonymously vet men they might meet on dating apps such as Tinder or Bumble – ensuring that the men are who they say they are, not criminals, and not already married or in a relationship. It's been compared to the Yelp of dating. In an Apple Store review, one woman wrote that she used a Tea search to investigate a man she'd begun talking to and discovered over 20 red flags, including serious allegations like assault and recording women without their consent. She said she cut off communication. 'I can't imagine how things could've gone had I not known,' she wrote. A surge in social media attention over the past week pushed Tea to the No. 1 spot at the US Apple Store as of July 24, according to Sensor Tower, a research firm. In the seven days from July 17-23, Tea downloads shot up 525 percent compared to the week before. Tea said in an Instagram post that it had reached 4 million users. Tea has been criticized for invading men's privacy. A female columnist for The Times of London newspaper who signed into the app on Thursday called Tea a 'man-shaming' site and complained that 'this is simply vigilante justice entirely reliant on the scruples of anonymous women.' 'With Tea on the scene, what man would ever dare date a woman again?' It's unclear what legal recourse an aggrieved man might have if he feels he's been defamed or had his privacy violated on Tea or a similar social media platform. In May, a federal judge in Illinois threw out an invasion-of-privacy lawsuit by a man who'd been criticized by women in the Facebook chat group 'Are We Dating the Same Guy,' Bloomberg Law reported. The breach exposed thousands of selfies and photo IDs. In its statement, Tea reported that about 72,000 images were leaked online, including 13,000 images of selfies or photo identification that users submitted during account verification. Another 59,000 images that were publicly viewable in the app from posts, comments, and direct messages were also accessed, according to the company's statement. No email addresses or phone numbers were exposed, the company said, and the breach only affects users who signed up before February 2024. 'At this time, there is no evidence to suggest that additional user data was affected. Protecting Tea users' privacy and data is our highest priority,' Tea said. It said users did not need to change their passwords or delete their accounts. 'All data has been secured.'
Leaders
4 hours ago
- Leaders
Trump, EU Chief Set for Crucial Trade Talks in Scotland
US President Donald Trump and European Commission President Ursula von der Leyen will meet in Scotland on Sunday, with the aim to resolve a prolonged transatlantic trade standoff that has persisted for months. Both leaders hope to establish a trade deal that benefits their respective economies. In a bid to reduce the United States' trade deficits, Trump has threatened to impose punitive tariffs on numerous countries, insisting that these tariffs will take effect if a trade agreement is not finalized by 1 August, as the EU faces a potential 30% levy, prompting them to negotiate vigorously with the Trump administration. Announcement of the Meeting Von der Leyen announced the meeting on X, stating, 'Following a good call with POTUS, we have agreed to meet in Scotland on Sunday to discuss transatlantic trade relations,' in what could a critical step in maintaining strong economic ties between the US and the EU. Trump arrived in the UK late Friday and confirmed his meeting with von der Leyen, expressing optimism about the discussions, stating, 'I'll be meeting with the EU on Sunday, and we'll be working on a deal.' He praised von der Leyen, calling her 'a highly respected woman,' and emphasized the importance of the upcoming negotiations. The Stakes of the Meeting Trump acknowledged the challenges ahead, noting that the chances of reaching a deal stand at '50-50,' mentioning that sticking points remain on 'maybe 20 different things.' However, he remains hopeful, stating, 'If we make it, that would be, actually, the biggest deal of them all.' This high-level meeting follows extensive negotiations between top EU and US trade officials, with recent signals suggest that both sides are moving closer to an agreement. European diplomats indicate that the proposed deal may involve a baseline 15% US levy on EU goods, similar to the agreement reached with Japan earlier this week. Paula Pinho, von der Leyen's spokesperson, confirmed that 'intensive negotiations' have occurred at both technical and political levels leading up to the meeting, stating, 'Leaders will now take stock and consider the scope for a balanced outcome that provides stability and predictability for businesses and consumers on both sides of the Atlantic.' Impact of Tariffs on the EU The EU has faced multiple waves of tariffs since Trump returned to the White House, with the EU currently endures a 25% levy on cars, a 50% tariff on steel and aluminum, and a 10% tariff on various goods as Trump threatens to increase this tariff to 30% if no deal is reached. The EU aims to avoid sweeping tariffs that could further harm its already sluggish economy. The trading relationship between the US and the EU is worth approximately 1.6 trillion euros ($1.9 trillion) annually. EU member states have authorized the European Commission to pursue a deal to prevent hefty US tariffs, with retaliation considered a last resort. To maintain pressure during negotiations, EU states recently supported a package of retaliatory measures on $109 billion (93 billion euros) worth of US goods, which will begin in stages from 7 August if no agreement is reached. Most EU states prefer a deal over no deal, even if it involves undesirable levies of 15%. Key Exemptions Under Discussion Exemptions for specific sectors remain crucial in negotiations as diplomatic discussions include potential carve-outs for aircraft, steel, lumber, pharmaceuticals, and agricultural goods. Regarding steel, a compromise may allow a certain quota to enter the US, with amounts exceeding that subject to a 50% tax. Since initiating its tariffs campaign, Trump's administration has announced only five agreements, including those with Britain, Japan, and the Philippines. While EU hopes for a deal have risen, the looming 1 August deadline brings a sense of déjà vu. Earlier this month, EU officials believed they were close to an agreement before Trump escalated his tariff threats. An EU diplomat emphasized, 'The final decision is in the hands of President Trump.' Short link : Post Views: 28
Saudi Gazette
4 hours ago
- Saudi Gazette
Trump says Cambodia and Thailand agree to begin ceasefire talks
EDINBURGH — U.S. President Donald Trump announced Saturday that Cambodia and Thailand have agreed to begin immediate ceasefire negotiations following three days of deadly cross-border fighting. In a post on Truth Social, Trump wrote: 'Both Parties are looking for an immediate Ceasefire and Peace ... They have agreed to immediately meet and quickly work out a Ceasefire and, ultimately, PEACE.' The U.S. president, currently on a visit to Scotland, said he spoke by phone with Cambodian Prime Minister Hun Manet and Thailand's acting prime minister in a bid to broker a truce. 'Thailand, like Cambodia, wants to have an immediate Ceasefire, and PEACE. I am now going to relay that message back to the Prime Minister of Cambodia,' he wrote in another post, adding, 'After speaking to both Parties, Ceasefire, Peace, and Prosperity seems to be a natural. We will soon see!' Trump, who returned to the White House six months ago, linked his diplomatic push to ongoing U.S. trade negotiations with both countries. 'We happen to be, by coincidence, currently dealing on Trade with both Countries, but do not want to make any Deal, with either Country, if they are fighting — And I have told them so!' He added that trade talks would resume only once the fighting stops: 'They are also looking to get back to the 'Trading Table' with the United States, which we think is inappropriate to do until such time as the fighting STOPS.' The president compared the Cambodia–Thailand crisis to past tensions in South Asia, stating, 'Many people are being killed in this War, but it very much reminds me of the Conflict between Pakistan and India, which was brought to a successful halt.' Trump's announcement follows a statement Friday by Malaysian Prime Minister Anwar Ibrahim, who said both sides had agreed to a ceasefire proposal. Cambodia has officially supported the initiative, while Thailand has said it agrees in principle. — Agencies
