Dubai: Gold prices drop ahead of Diwali festival

Many Indians consider it auspicious to buy gold and precious metal jewellery during this period

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by

Waheed Abbas

Published: Thu 24 Oct 2024, 9:57 AM

Last updated: Thu 24 Oct 2024, 10:00 AM

Gold prices dipped at the opening of markets in Dubai on Thursday, extending their decline from the last session on Wednesday evening.

Gold prices have been consistently hitting record highs over the past few months, driven by expectations about interest rate cuts by the US Federal Reserve, geopolitical tensions in the Middle East and strong buying by China.

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The drop in prices late on Wednesday and early Thursday is a welcome move for Dubai shoppers ahead of the Indian festival Diwali, which will be marked next week. Many Indians consider it auspicious to buy gold and precious metal jewellery during the festival.

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At 9am UAE time on Thursday, the 24K variant of the yellow metal slipped to Dh331.25 per gram compared to last night’s close of Dh331.5 per gram. It touched an all-time high of Dh333 per gram on Wednesday morning.

Among the other variants, 22K, 21K and 18K slipped to Dh305.75, Dh296 and Dh253.75 per gram, respectively.

Spot gold was trading at $2,727,32 per ounce, up 0.22 per cent at 9.20am UAE time. But it is down from $2,750 per ounce trading in early trade on Wednesday.

[Editor's Note: For real-time gold rates, click on the widget below or visit KT's dedicated Trading News page here.]

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Vijay Valecha, chief investment officer, Century Financial, said gold hit another record high, driven by the conflicts in the Middle East and volatility surrounding the upcoming US election, which increased demand for safe-haven assets.

“Gold’s rally comes despite the US dollar clinging to a more than two-month peak as treasury yields rise. Strong US economic data has resulted in investors fearing that inflation might take longer to fall to the US Federal Reserve’s 2 per cent target, resulting in a reduction of 50 bps rate cut probability for November. Investors now eagerly await the US PMI and initial jobless claims results, expected to be released on Thursday,” said Valecha.

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Waheed Abbas

Published: Thu 24 Oct 2024, 9:57 AM

Last updated: Thu 24 Oct 2024, 10:00 AM

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