Gold rebounds as rupee pulls back, gains Rs350 per tola

• Gold price settles at Rs126,350 per tola.
• Bullion rates in Pakistan are around Rs1,000 below the cost.
• Silver prices in the domestic market remain unchanged.

KARACHI: In line with the trend in the international market, gold prices in Pakistan recorded an increase of Rs350 on Monday, as it gained respite from a retreat in the rupee.

Gold was up Rs350 at Rs126,350 per tola and increased by Rs300 to Rs108,325 per 10 grams. The rates of gold were Rs126,000 per tola and Rs108,025 per 10 grams on Saturday.

However, it is pertinent to mention that gold rates in Pakistan are around Rs1,000 below the cost compared to the gold rate in the Dubai market.

Meanwhile, silver prices in the domestic market remained unchanged at Rs1,470 per tola and Rs1,260.28 per 10 gram on Monday.

Bullion prices in global markets

Gold prices advanced towards last week's two-month high on Monday as US bond yields continued to fall and investors looked to invest in the safe-haven metal amid concerns over the prospect of a Russian attack on Ukraine.

Spot gold was 0.3% higher at $1,838.10 per ounce, close to last week's high of $1,847.72 an ounce. US gold futures rose 0.4% to $1,838.60.

Investors are looking towards the US Federal Reserve's two-day policy meeting starting on Tuesday. The Fed is expected tighten monetary policy at a much faster pace than thought a month ago to tame persistently high inflation. 

"I don't expect (Fed) to have a significant impact on what gold prices are doing at this moment because the markets are more concerned about what's going on in eastern Europe," said Michael Hewson, chief market analyst at CMC Markets UK.

"The markets have already priced in a March hike so I don't think there's going to be any surprise."

— With additional input from Reuters.