KARACHI, May 10: Domestic gold prices fell by Rs708 per 10 grams in the last one month owing to the rising strength of dollar, leaving global gold prices dropped by $44 per ounce in just one month.

On Monday, domestic gold prices settled at 7,115 per 10 grams owing to persistent declining trend in global gold rates which ranged between $370-371 per ounce as compared to $410 per ounce in the first week of April when local bullion rate was Rs7,823 per 10 grams.

This new development in shape of price stability in the yellow metal has sent a shockwave among the investors who had been running after the gold for the last two months.

The rate of 10 tola bar, which had skyrocketed to Rs91,000- Rs92,000 in April, suffered a drop of 13 per cent in one month to Rs80,300 on Monday, thus sparking doubts among investors whether to buy gold bars or adopt a wait and see policy.

Investors went wild for the gold bars a month back in anticipation of further rise in domestic prices as a result of rising world prices. Foreign investors, after losing hope in the greenback a month against euro and yen, had generated a renewed vigour in the dollar.

On the contrary, local buyers, arranging gold jewellery sets because of the on-going marriage season, had been beneficiaries as they had to pay lower as compared to a month back.

"Local investors have now become cautious in buying bullion bars due to wide fluctuations in prices," the chairman, All Pakistan Gem Merchants and Jewellers Association (APGMJA), Akhtar Khan said, adding that only local buyers are present in the markets.

"Our sales are improving in the marriage season that kicked off after the Rabi-ul-Awwal," he said adding that around 10,000- 15,000 tola of gold was being imported daily.

However, former chairman of APGMJA, Raeesuddin Shaikh said that sales were going on but lacked fervour due to uncertain city situation after the suicide bomb blast in Hyderi Mosque.

He said that inflationary trend in prices of essential items had caused a major change in the buying attitude of consumers specially during the wedding season. "People are not giving too much jewellery sets to their daughters for security reasons if compared with previous years.

Price hike shakes up the saving plans of consumers," he added. Currently, he said that investors had disappeared from the markets and only local sales are progressing.

Local investors keep their eyes wide open on the international price movements and change their mood in the buying and selling of gold bars in the local markets. Currently, they are a bit reluctant to make bulk buying in yellow bars after smelling a frequent drop in world gold prices.