Gold prices in Pakistan moved higher on Friday, following a rise in international bullion rates as investors grew more hopeful that US interest rates may remain unchanged this month.
The price of gold increased by Rs3,900 per tola to reach Rs469,136, according to rates released by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA).
The price of 10-gram gold also rose by Rs3,344, taking it to Rs402,208.
Gold had already posted a strong gain on Thursday, when the price of one tola jumped Rs11,200 to Rs465,236.
The latest increase came as international gold prices gained $39 to reach $4,466 per ounce, including a $20 premium.
Silver also became more expensive in the local market. Its price rose by Rs117 to Rs7,161 per tola.
Why gold prices are rising
Gold prices have found some support this week as traders reduced their expectations of a US interest rate hike in September.
The shift followed comments from Federal Reserve Governor Christopher Waller, who said he was leaning towards keeping rates unchanged if upcoming inflation data shows that price pressures are easing.
Gold does not pay interest, so it often becomes more attractive when investors expect interest rates to stay lower. Higher rates, on the other hand, can make interest-bearing assets more appealing.
Spot gold was trading near $4,475 an ounce on Friday, while US gold futures for December delivery stood at around $4,521.
The metal is also on track for a modest weekly gain after recovering from a three-week low recorded on Wednesday.
However, the next major test for gold could come from US economic data. The non-farm payrolls report is due on Friday, followed by inflation figures next week.
Investors will be watching these numbers closely for clues about what the Federal Reserve may do with interest rates.
Analysts remain positive on gold. Citi has set a three-month price target of $4,800 an ounce and expects gold to reach $5,000 over the next six to 12 months.
Demand has also picked up in major Asian markets. Lower prices encouraged some buying in India, while investment flows continued to support gold demand in China.
The global silver price was around $66.95 an ounce, while platinum stood at $1,812.66 and palladium at $1,411.57.