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Gold prices in Dubai drop after Fed decision to leave interest rates unchanged
Although the Fed kept interest rates unchanged, policymakers maintained a cautious tone, suggesting inflation risks remain despite recent moderation
- PUBLISHED: Thu 30 Jul 2026, 9:36 AM
Gold prices in Dubai fell on Thursday after the UAE Central Bank kept its benchmark interest rate unchanged, following the US Federal Reserve's decision to leave rates on hold.
The 24K variant in Dubai was trading at Dh487.50 per gram at the market open on Thursday, down from Dh491.50 at the close of the markets on Wednesday. The other variants, 22K, 21K, 18K, and 14K, were trading at Dh441.50, Dh432.75, Dh371, and Dh289.25, respectively.
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Globally, spot gold edged up 0.12 per cent to $4,044.99 per ounce, while silver fell 1.07 per cent to $57.19 per ounce.
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The Central Bank of the UAE on Wednesday left its benchmark rate unchanged at 3.65 per cent, mirroring the US Federal Reserve's decision to keep the federal funds target range at 3.5 per cent to 3.75 per cent. The UAE typically follows US monetary policy because the dirham is pegged to the dollar.
Although the Fed kept interest rates unchanged, policymakers maintained a cautious tone, suggesting inflation risks remain despite recent moderation.
Nick Spencer-Skeen, Senior Executive Officer of Lunaro Markets Limited, said that June’s economic data provided support for the Federal Reserve to keep rates unchanged.
“Core inflation cooled to 2.6 per cent year-on-year, and payrolls came in at just 57,000 against a forecast of 114,000,” he said. “What’s kept a hike in play is the dot plot from June, half the Committee still had at least one hike pencilled in for this year, plus oil, which climbed sharply during the worst of the fighting and put the inflation improvement in doubt,” he added.”
Vijay Valecha, Chief Investment Officer at Century Financial, said the Fed's decision to keep rates unchanged was consistent with recent economic data. "June inflation data came in softer than expected, and the labour market does not show signs of overheating, supporting arguments to leave rates unchanged.”
He added, “The current economic data have been more favourable than what the Fed had in front of them in June. It would have been strange for the Fed to respond to that set of data by hiking at the July meeting when it chose not to in June."
Hind Aldah is a business reporter based in Sharjah. In her spare time, you will find her playing classical guitar, painting amateur oil paintings, or crocheting the same old scarf that leads nowhere.