Dubai: Gold price drops, equities seen more lucrative
Biggest single-day dip on Wednesday as prices plunge by 0.7 per cent
Gold prices dropped Thursday morning as investors were wary ahead of US Federal Reserve chairman Jerome Powell's speech this week.
Spot gold was trading at $1,787.14 per ounce by 9.15 am UAE time. Prices fell 0.7 per cent on Wednesday, its biggest one-day decline in more than two weeks.
In the UAE, the Dubai Gold and Jewellery Group data showed 24K trading at 216.25 per gram on Thursday morning. Among the other variants of the precious metal, 22K was trading at Dh203.25, 21K at Dh194.0 and 18K at Dh166.25 per gram.
Fed chairman Powell is scheduled to speak at Fed's annual economic symposium at Jackson Hole, Wyoming, on Friday, which will provide cues to the central bank's tapering of economic stimulus.
Ipek Ozkardeskaya, senior analyst at Swissquote, said the precious metal fell below $1,800 an ounce level because stocks are too appetising and too prosperous for investors to sit on gold.
“The topside in gold should remain limited, as long as we see the US equities claiming new records,” he said.
Benchmark S&P 500 and the Nasdaq closed at record highs last night.
Naeem Aslam, chief market analyst at AVA Trae, said the precious metal is likely to see higher volatility as traders believe that the central bank's stimulus tapering may be delayed in order to provide more support to the US economy.
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