UAE: Gold prices drop; 22K opens at Dh206, down Dh1 per gram

The Dubai Gold and Jewellery Group data showed 24K opening at Dh219.25 per gram on Wednesday.

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A Staff Reporter

Published: Wed 19 Jan 2022, 9:35 AM

Gold prices fell in the UAE and worldwide on Wednesday morning as the prospect of aggressive rate hikes by the US Federal Reserve sent benchmark Treasury yields to two-year highs, reducing the appeal of the precious metal.

Spot gold was down 0.12 per cent at $1,812.29 per ounce, as of 9.10 am UAE time.

In the UAE, the yellow metal price dropped one dirham per gram on Wednesday as compared to Tuesday’s close of the market.

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The Dubai Gold and Jewellery Group data showed 24K opening at Dh219.25 per gram on Wednesday, down from last night’s close of Dh220.25. Among the other variants, 22K opened at Dh206.0 per gram, 21K at Dh196.75 and 18K at Dh168.5.

"We seem to be coiling up for some kind of breakout, likely on the downside, as the handoff occurs where inflation expectations start to slow down while nominal rates shift up around expectations for central bank action and that starts to really bid up real yields," said Ilya Spivak, currency strategist at DailyFX.

Edward Moya, senior market analyst at Oanda, said overall, gold prices are clearly hanging in there given that Treasury yields have skyrocketed this month.

“Gold is in for a choppy period, but the medium-term outlook remains bullish if prices can hover around the $1,800 level. Gold will remain an inflation hedge for much of Latin America and the emerging world,” added Moya.

waheedabbas@khaleejtimes.com

A Staff Reporter

Published: Wed 19 Jan 2022, 9:35 AM

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