How far will Dubai gold prices drop?

How far will Dubai gold prices drop?

In Dubai, the price reached Dh148.50, a dirham lower than yesterday's Dh149.50.

By Reuters

Published: Tue 7 Mar 2017, 8:16 AM

Last updated: Tue 7 Mar 2017, 1:34 PM

Gold prices were little changed on Tuesday, hovering above a two-week low hit on Friday, amid expectations of a US interest rate hike this month and ahead of key economic data due later in the week.
In Dubai, the price reached Dh148.50, a dirham lower than yesterday's Dh149.50. Is gold on its downward slide now?
The US monthly jobs report due on Friday includes the non-farm payrolls, seen rising by 190,000 in a Reuters poll. Prices on most US interest rates futures rose modestly on Monday as traders bet on a strong likelihood the Federal Reserve will raise rates at its upcoming policy meeting next week.
"We expect the precious metal to have a bumpy ride the rest of the week as we await further economic indicators from the US such as the key February jobs numbers on Friday and the Fed meeting next week," said Mihir Kapadia, CEO and Founder of Sun Global Investments.
Is now the best time to buy gold in Dubai?
Spot gold was mostly unchanged at $1,225.99 per ounce at 0322 GMT. US gold futures edged up 0.1 percent to $1,226.1.
The metal hit $1,222.51, the lowest since Feb. 15, on Friday after US Federal Reserve Chair Janet Yellen said that the Fed was poised to lift benchmark US rates, provided jobs and inflation data held up, comments seen as cementing plans for an increase at the Fed's March 14-15 meeting. [FED/DIARY] Spot gold may break a support at $1,223 per ounce and fall more to the next support at $1,213, probably after a moderate bounce to a resistance at $1,230, according to Reuters technical analyst Wang Tao.
Higher US interest rates would boost the dollar and make commodities priced in the greenback costlier for holders of other currencies.
"I think that the rate rise is now in the price more or less, but the market will be focusing on the language surrounding the pace of future rate rises," said Nicholas Frappell, general manager with ABC Bullion.
The market will also await monetary policy decisions from the European Central Bank. The ECB will stay in the background through upcoming elections in key European countries and is only likely to signal a shift away from its ultra-easy monetary policy toward the end of this year or early next, a Reuters poll found.
Meanwhile, holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.45 percent to 836.77 tonnes on Monday.

More news from Markets