Dubai: Gold prices rise further in early trade

An expert sees the yellow metal approaching a key resistance level at the upper end of its multi-week range between $2,660 and $2,670

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Photo: AFP file
by

Waheed Abbas

Published: Tue 15 Oct 2024, 9:38 AM

Gold prices opened higher in Dubai for the second day this week on Tuesday, rising half a dirham per gram.

According to Dubai Jewellery Group data, 24K gold was trading at Dh322 per gram at 9am, UAE time, up from Dh321.50 when the markets closed on Monday.

The other variants of the yellow metal, 22K, 21K and 18K, were also trading higher at Dh298.25, Dh288.75, and Dh247.50 per gram, respectively.

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

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Spot gold was at $2,642.49 per ounce, down 0.26 per cent. The yellow metal crossed $2,650 per ounce on Monday but trended lower later.

Rania Gule, senior market analyst at XS.com, said gold witnessed a significant rise and traded near the $2,653 mark on Monday, amid the geopolitical tensions in the Taiwan Strait, where China conducted military drills, raising international concerns and driving investors to seek refuge in gold as a haven.

“This tension between China and Taiwan is one of the key factors that fuel the current demand for gold, especially as tensions continue to escalate in the Middle East. Historically, this pattern tends to repeat in financial markets, as gold gains additional strength during geopolitical crises, serving as a haven where investors turn in times of uncertainty and risk,” she said.

In addition, the recent fiscal stimulus announced by China bolstered support for gold prices.

“China is the largest market for the yellow metal, and any measures to support its economy directly affect global demand for gold. Over the weekend, China's finance minister announced a broad stimulus package aimed at addressing local government debt and providing additional support to the slowing economy. Given this, I believe that demand for gold in China will increase, which could push gold prices to new highs, particularly if the stimulus continues to impact the Chinese economy in the medium term,” said Gule.

She sees the yellow metal approaching a key resistance level at the upper end of its multi-week range between $2,660 and $2,670.

“I believe gold will continue to rise as global tensions persist. The economic policies adopted in China will be crucial in determining the strength of demand for gold in the global market. While we may see short-term fluctuations in gold price movements, the overall trend points to further gains if current conditions continue,” added Gule.

Waheed Abbas

Published: Tue 15 Oct 2024, 9:38 AM

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