Gold prices in Pakistan fell sharply on Thursday, with the local market rate dropping Rs3,800 per tola as prices moved lower in the international market.
According to rates released by the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), gold fell to Rs453,436 per tola.
The price of 10-gram gold also declined by Rs3,257 to Rs388,749.
The latest drop came a day after gold recorded a strong increase in the local market. On Wednesday, the price of one tola had risen by Rs7,900 to Rs457,236.
The international gold rate quoted for the local market fell by $38 to $4,309 per ounce, contributing to the decline in domestic prices.
Silver prices also moved lower on Thursday. The precious metal fell Rs73 to Rs6,869 per tola in Pakistan.
Gold rebounds in global market
Global gold prices later recovered from a sharp fall recorded in the previous session, supported by weaker oil prices and a softer US dollar.
Spot gold was up 2.4 percent at $4,364.29 per ounce at 9:11am EDT, while US gold futures for December delivery gained 0.4 percent to $4,404.80.
The decline in oil prices helped ease some concerns over inflation, which can affect expectations for interest rates and influence demand for gold. Oil prices extended their decline for a second day as fears over supply disruptions eased.
The US dollar also pulled back from a seven-week high. A weaker dollar generally makes gold cheaper for buyers using other currencies.
The yield on the 10-year US Treasury also slipped, supporting demand for gold as lower yields reduce the opportunity cost of holding the non-yielding metal.
Investors were also assessing the US Federal Reserve’s latest interest rate decision and signals about future policy. Markets were pricing in a 51 percent chance of another rate increase at the Fed’s October meeting, up from nearly 44 percent a day earlier, according to the CME FedWatch tool.
UBS said higher fiscal deficits, rising debt and expectations of a weaker US dollar could support gold over the longer term, despite short-term price swings.
In other precious metals, spot silver rose 3.9 percent to $65.44 an ounce, while platinum gained 2.1 percent to $1,787.68 and palladium increased 2.2 percent to $1,296.86.
Read next: Gold price in Pakistan today: per tola rate drops further