Gold prices climbed 2 per cent on Wednesday, rebounding from their lowest in more than a week reached in the previous session, as the dollar took a breather and mounting tensions in the Middle East drove investors toward safe havens.
However, gold prices in Pakistan registered a significant drop of Rs10,000 per tola, settling at the rate of Rs 539,962 per tola.
Spot gold gained 2.2pc to $5,198.58 per ounce by 10:17 GMT, after falling more than 4pc on Tuesday.
U.S. gold futures for April delivery added 1.7pc to $5,211.20.
The U.S. dollar fell 0.2pc, making greenback-priced gold more affordable for buyers using other currencies.
“After the past few days of position unwinds and dollar strength, markets are back to a more typical macro risk-off stance, with silver higher too. A pause in the rise of the dollar and Treasury yields helps with their opportunity costs,” said Jamie Dutta, market analyst at Nemo.money. “Gold and silver’s safe-haven characteristics can shine again.”
Spot silver advanced 5.3pc to $86.39 per ounce, after falling more than 8pc in the last session.
Gold’s appeal as it draws support from the widening conflict in the Middle East is expected to remain intact even if some investors have favored the dollar as their preferred safe-haven, traders and analysts said on Tuesday.
Asian stocks tanked as investors dumped crowded bets on chipmakers on worries that the widening Middle East war would drive an oil shock, accelerating inflation and delaying interest rate cuts.
Markets see the US Federal Reserve holding rates at its two-day meeting later this month.
“If the military campaign prolongs or expands across the region, safe-haven demand could continue to support gold above the $5,000/oz level and potentially open the door for a retest of the recent highs,” said Linh Tran, senior market analyst at XS.com.
Spot platinum added 5.1pc to $2,189.68 an ounce. The global platinum market is forecast to post a fourth consecutive year of deficit in 2026 at 240,000 troy ounces, the World Platinum Investment Council said. Palladium gained 3.6pc to $1,705.71.