Gold price rebounds 2% from one-year low as oil falls - what it means in Pakistan

The gold price rebounded about 2% on Monday, 2 November, climbing back toward $4,000 an ounce after hitting a one-year low on Friday. Spot gold rose 2.1% to $3,957.19 an ounce, Reuters reported, as a sharp fall in oil prices eased worries about inflation and further interest rate hikes.

Gold held near that level in early Asian trade on Tuesday. For buyers in Pakistan, the international price is the main driver of the Sarafa rate, so the rebound is likely to show up in local quotes, adjusted for the rupee and the local premium.

Gold price today: the key figures

These are the figures reported by Reuters through Business Recorder and Investing.com.

Monday's gain was gold's biggest daily rise in about two months. It came after a hard October, when gold fell 6.8% and dropped below $4,000 near the end of the month. On Friday it closed 3.6% lower, at its lowest level since October 2025. Silver also briefly slipped below $50 for the first time since late November 2025.

Why is the gold price going up again?

Several factors pushed gold higher, according to the reports:

• Cheaper oil: oil fell more than 7% on Monday on hopes of US-Iran peace talks, which we cover in our oil price story. Lower oil eases inflation fears and the pressure on central banks to raise rates.
• Oversold market: a common technical gauge, the 14-day relative strength index, had fallen below 30 last week. It recovered to about 37, a sign that the heavy selling had paused.
• Buying in China: ANZ pointed to buying by Chinese households.
• A slightly softer dollar: the dollar index slipped to 101.80, which makes gold cheaper for holders of other currencies.

Why did gold fall to a one-year low?

Gold usually rises in uncertain times, so October's fall surprised many buyers. Reuters reported two main reasons. First, high energy prices had raised expectations that the US Federal Reserve would keep raising rates, and higher rates make gold, which pays no interest, less attractive. Second, a sell-off in technology and AI-linked shares forced some investors to sell gold to cover losses elsewhere.

Will the Fed raise rates in December?

Markets still expect a hike. Based on CME FedWatch, traders see a 77% chance of a US rate hike in December, down from 80% a week earlier. We explained the Fed's last decision in our story on the Fed's split vote.

Analysts quoted by Reuters said the US fiscal picture, with large deficits whatever the result of the 3 November midterm elections, should support gold over the longer term. Renewed fighting in the Middle East remains a risk that could move both oil and gold sharply.

What it means for Pakistan

In Pakistan, the All Pakistan Sarafa Gems and Jewellers Association sets the daily rate, mainly from the international price and the rupee-dollar rate. The last rate we reported was Rs409,736 per tola of 24-karat gold on 31 October, in our gold price story.

Illustration only: one tola is 11.6638 grams and one troy ounce is 31.1035 grams. At $3,957.19 an ounce and about Rs276.69 to the dollar, the international price works out to roughly Rs410,593 per tola, before the local premium or discount. This is a conversion, not the official Sarafa rate.

What this means for you:

• Wait for the official rate: Sarafa rates are announced daily and can differ from city to city. Track the history on our rate tracker.
• Remember making charges: jewellers add making charges and may deduct for wastage when you sell, so jewellery costs more than the bullion rate.
• Check purity: ask for a hallmark or a written receipt showing karat and weight.
• Expect swings: gold moved by several percent within days in October and November, mostly on oil and Fed news.

This article is for information only and is not investment advice.