KARACHI: Gold extended gains in Pakistan for the second day with the price increasing by Rs850 per tola on Friday as the rupee continues to decline against the US dollar.
Data released by All Sindh Sarafa and Jewellers Association (ASSJA) showed that the price of gold rose by Rs850 per tola and Rs728 per 10 grams to settle at Rs151,700.
The yellow metal had scaled record in July. Prices have since moved into a steadier range as the market digested a more hawkish outlook from the depreciating rupee and falling markets.
Read more: Gold bounces in Pakistan as rupee dips, inflations risks grow
The precious commodity remains caught between elevated inflation, growing concerns over a recession and a flight to quality on the one hand, but sharp rate hikes, a strong dollar globally and seasonally weak demand on the other.
Investors who used to pour money into foreign currencies, particularly the US dollar to avoid the impact of inflation, are now buying gold because the government and the central bank are trying to reduce the rupee-dollar parity.
Past practices suggest that people used to take aggressive positions in gold in inflationary days.
In the international market, the price of yellow metal decreased by $4 per ounce to settle at $1,721.
Gold rates in Pakistan are around Rs4,000 below the cost compared to the rate in the Dubai market. Meanwhile, silver prices in the domestic market gained Rs60 per tola and Rs51.44 per 10 grams to close at Rs1,540 per tola and Rs1,320.30 per 10 grams.