UAE: Gold prices shoot up again, jumping another Dh2 per gram

Precious metal rates could rise further if Middle East conflict doesn’t subside

Waheed Abbas

Published: Tue 10 Oct 2023, 9:26 AM

Last updated: Thu 12 Oct 2023, 3:22 PM

Gold prices rally continued on Tuesday morning, jumping two dirhams per gram at the opening of the markets in the UAE as investors shifted to safe-haven commodity in the wake of the Middle East conflict.

Analysts expect the yellow metal to continue rising if the Israel-Palestine conflict doesn’t subside in the coming days.

According to Dubai Jewellery Group data, the 24K was trading at Dh225.5 per gram on Tuesday at 9 am. While 22K, 21K and 18K were trading at Dh208.75, Dh202.0 and Dh173.25 per gram, respectively.

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Spot gold gained 0.1 per cent to $1,862.80 per ounce.

“Gold prices jumped after the eruption in tensions in the Middle East as investors erred to the side of caution in fear of further escalation. Safe haven assets, including gold, could become more attractive in the meantime and could see more inflows if tensions do not abate. The market could see more volatility as new geopolitical developments emerge,” said Wael Makarem, senior market strategist for Mena at Exness.

“However, gold prices could remain under pressure overall with interest rates and bond yields at elevated levels as monetary policy could remain a major weight,” he said.

Vijay Valecha, chief investment officer, Century Financial, said escalating geopolitical tensions in the Middle East prompted gold to open with a bullish gap and reach its highest level in over a week at the beginning of the new week.

“Nevertheless, the presence of renewed US dollar buying activity has limited further upside potential for the gold price. Traders are now closely monitoring the release of the FOMC meeting minutes and US consumer inflation figures scheduled for this week,” he said.

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