UAE: Gold prices drop in Dubai in early trade

The 24K opened lower at Dh231.75 per gram on Monday

Waheed Abbas

Published: Tue 17 Oct 2023, 9:52 AM

Last updated: Tue 17 Oct 2023, 9:53 AM

Gold prices dropped in the UAE and globally on Monday morning ahead of the US Federal Reserve chair Jerome Powell’s speech which would give some clues about the upcoming interest rate decision.

In the UAE, the 24K opened lower at Dh231.75 per gram on Monday at 9 am as compared to last night’s close of Dh232.25 per gram. Similarly, 22K, 21K 18K also opened lower at Dh214.75, Dh207.75 and Dh178.0 per gram, respectively.

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Spot gold dropped 0.18 per cent to $1,916.02 per ounce by 9.30 am UAE time.

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Rania Gule, market analyst at XS.com, said the precious metal saw strong gains of 3.5 per cent on Friday but quickly retreated from its peak levels in Monday's trading, currently hovering around $1,920.

“As the conflict in Palestine escalated last week with an intensifying attack on Gaza, market demand shifted from riskier assets to safe-haven plays. Gold prices surged and closed at $1,933 on Friday, up from their low of $1,868 per ounce within hours,” said Gule.

She added that expectations for gold prices are bearish. “It's not likely that gold prices will decline in the short term, but they may fall faster than markets anticipate.This has occurred several times in the past, with the most significant peak in February 2022 when the Russian invasion of Ukraine began. When we focus on economic events in the US during that period and then focus on war news exclusively, we find that gold prices continued to rise for several days but peaked for no more than two weeks before reversing to the downside. So, in the case of the ongoing conflict in the Middle East, when might this reversal occur? I believe it may happen after several days or no more than two weeks of the actual attack, both of which could occur this week,” added Gule.

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