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UAE: Gold prices drop Dh1 per gram in early trade

Yellow metal rates have stagnated as investors await crucial US inflation data expected later this week

Published: Wed 26 Jun 2024, 9:41 AM

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Shopper looks on the display of gold ornaments at a jewellery shop in Deira Gold Souq. KT Photo: Shihab

Shopper looks on the display of gold ornaments at a jewellery shop in Deira Gold Souq. KT Photo: Shihab

Gold prices fell Dh1 per gram in Dubai on Wednesday morning as precious metal fell globally on Tuesday due to a stronger US dollar.

In the UAE, the 24K variant of the yellow metal was trading at Dh280.5 per gram on Wednesday morning as against Dh281.5 per gram at the close of the markets on Tuesday. Among the other variants, 22K opened at Dh259.75, 21K at Dh251.5 and 18K at Dh215.5 per gram.

Globally, gold was down 0.14 per cent at $2,317.03 per ounce at 9.17 am UAE time.

George Khoury, global head of education and research at CFI, said gold prices have stagnated as investors await crucial US inflation data expected later this week, which could influence the Federal Reserve's approach to interest rate adjustments.

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The upcoming data includes the US core Personal Consumption Expenditures (PCE) index alongside metrics on consumer spending and income, Q1 GDP growth, and the goods trade balance.

San Francisco Fed Bank President Mary Daly emphasised on Monday that the US central bank should not consider lowering rates until it is clear that inflation is consistently moving towards the 2 per cent target.

“More speeches are expected throughout the week from figures such as Fed Governors Lisa Cook and Michelle Bowman, which could offer additional clues on the future monetary policy and impact market sentiment.

"Upcoming elections in France and the United Kingdom are stirring investors’ concerns, with polls indicating a possible shift towards the far right in France. Additionally, escalating tensions in the Middle East and the ongoing conflict between Russia and Ukraine could heighten market uncertainty, potentially bolstering gold prices as investors seek stability,” said Khoury.

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