A strong US Dollar is reducing the price of Gold, whilst competition from Bitcoin and stocks is also bearish, as per international media.

A day earlier, the gold rate per tola decreased by Rs1,300, to Rs277,500. The gold rates saw decline after remaining unchanged in the previous session.

The 10-gram gold decreased by Rs1,115 and sold at Rs237,911 on Monday, according to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).

In the international market, gold traded at seven-week lows around $2,600 as it found support from a major trendline, according to FX Street. A stronger US Dollar (USD) puts pressure on the precious metal due to market perceptions that President-elect Donald Trump’s economic policies will be positive for the Greenback, the FX report said. Given Gold is mainly priced and traded in US Dollars, a stronger USD alone is often enough to bring down its price, it maintained.

According to the report, Trump’s pledges to impose tariffs on imports, reduce taxes, and deport millions of illegal immigrants are likely to push up prices in the US and drive higher inflation.  This would likely lead to the US Federal Reserve (Fed) slowing the pace of interest rate cuts as it tries to combat the resulting inflation. Relatively higher interest rates are negative for Gold since they increase the opportunity cost of holding the non-interest paying asset.

Market-based gauges are already showing a 31% probability the Fed will leave interest rates unchanged at their December meeting when previously they had shown a 100% probability of at least a quarter percent reduction, according to the CME FedWatch tool.