Dubai: Gold prices trade higher as dollar weakens

Gold prices opened higher in Dubai and globally on Tuesday morning after the dollar retreated as cautious investors awaited further US economic data due this week to gauge the Federal Reserve's next policy move.

Spot gold rose 0.3 per cent to $1,994.90 per ounce, while 24K opened at Dh241.25 per gram on Tuesday as against last night’s close of Dh239.50 per gram. Among the other variants of the precious metal, 22K, 21K and 18K were trading at Dh223.25, Dh216.25 and Dh185.25 per gram, respectively.

Naeem Aslam, chief investment officer, Zaye Capital, said the precious metal has started to lose its mojo, and the main reason behind it is the strength in the dollar index.

“This week’s US GDP number could bring some buyers back into the market as traders would consider hedging their bets if the data shows more than expected weakness,” he said.

According to Aslam, the $2,000 price level continues to remain an important price point for traders and investors because when the price trades above this level, it raises hopes for a new record high. “However, when the price trades below the price point, traders believe that the precious metal could experience a significant correction,” he said.

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