Gold prices in Pakistan remained stable on Wednesday, with the rate per gram at 34,894.75 PKR. The price per tola was at 407,006.00 PKR, showing little change from the previous day’s figures.
Gold has increased by 45% since 2025, with an 11% rise in September, as global uncertainty fuels demand for safe-haven assets. A potential US government shutdown and interest rate cut expectations could impact gold’s appeal.
Interest Rate Forecasts
The CME Group’s FedWatch Tool indicates a 95% probability of an interest rate cut in October and over 75% likelihood in December. The US Bureau of Labor Statistics reported 7.22 million job openings in August, slightly above estimates.
Geopolitical risks remain due to tensions between Russia and Ukraine, influencing gold’s safe-haven demand. FXStreet calculates Pakistan’s gold prices by adapting international rates to local currency, noting possible discrepancies.
Gold has been pivotal historically as a value store and exchange medium. Central banks are the largest gold holders, with significant purchases in 2022 to bolster economic stability. Gold’s price typically rises with a weaker US Dollar and lower interest rates.
Given the impressive 45% rally in gold since the start of 2025, we should anticipate continued upward momentum. With the metal hitting fresh all-time highs, derivative strategies should be positioned to capture further gains. The market’s current stability suggests a brief consolidation before the next potential move higher.
Impact Of US Government Shutdown
The partial US government shutdown, starting today, is a primary catalyst that will likely fuel a flight to safety. Looking back, the Congressional Budget Office estimated that the 2018-2019 shutdown permanently erased about $3 billion from the US economy, showing these events have a real impact. This historical precedent reinforces the view that a prolonged shutdown will weaken economic performance and strengthen gold, making long call options an attractive strategy for the weeks ahead.
Furthermore, we see the market pricing in a near-certainty of a Federal Reserve rate cut in October 2025, with another expected in December. This dovish stance is a powerful tailwind for a non-yielding asset like gold, a pattern we also observed during the Fed’s 2019 easing cycle when gold rallied over 15% in just a few months. Even with some Fed officials sounding cautious, the overwhelming market expectation is for lower rates, which supports holding bullish gold positions.
Underpinning this price action is persistent and strong demand from institutional players. Central banks have continued their aggressive purchasing, with recent World Gold Council data for the third quarter of 2025 confirming they remained significant net buyers. This consistent demand provides a solid floor for the price and suggests that any price dips will likely be met with strong buying interest.
Finally, escalating geopolitical risks, such as the potential for the US to supply longer-range missiles to Ukraine, add another layer of market uncertainty. These tensions tend to benefit safe-haven assets directly. This environment of heightened volatility makes options strategies particularly relevant, as they can be used to manage risk while maintaining exposure to gold’s upside potential.
