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Dubai: Gold prices steady in early trade on Tuesday

Globally, spot gold was trading at $2640.85 per ounce, up 0.10 per cent

Published: Tue 7 Jan 2025, 9:38 AM

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Gold prices were steady at the opening of the markets in Dubai on Tuesday.

The Dubai Jewellery Group data showed 24-carat selling at Dh319.5 per gram and 22-carat Dh295.75 per gram.

Among the other variants, 21-carat and 18-carat were trading at Dh286.25 and Dh245.25 per gram, respectively.

Globally, spot gold was trading at $2640.85 per ounce, up 0.10 per cent.

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Rania Gule, senior market analyst at XS.com, said gold faces increasing challenges under the pressure of a strong US dollar, which remains near its highest levels in two years, supported by hawkish statements from the Federal Reserve.

“While the price breached levels near $2,635, the neckline of a bearish head-and-shoulders pattern on the hourly chart, the decline can fundamentally be attributed to the continued strength of the dollar and market expectations of a slower pace of interest rate cuts in 2025. Despite these fundamental and technical factors pointing to potential weakness in gold, geopolitical tensions and global concerns continue to support it,” she said.

Gule believes that the improvement in US industrial activity strengthens economic forecasts, which in turn boosts the US currency and increases pressure on gold.

“As the dollar rises, gold becomes more expensive for foreign investors, reducing demand for the yellow metal. However, positive economic expectations in the US are pushing investors away from gold, which is typically seen as a hedge against economic downturns,” said XS.com’s senior market analyst.

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