UAE: Gold prices fall; 24K drops below Dh210 again in Dubai
Global cues and strengthening of US dollar trigger a dip in prices of precious yellow metal
Gold prices inched lower on Monday, as the US dollar and global share markets firmed on the back of improving economic outlook, with elevated bond yields putting further pressure on the precious metal.
Spot gold price was down 0.05 per cent to $1,727.99 per ounce by 9.15 am UAE time on Monday. US gold futures were also down at $1,728.10 per ounce.
Dubai retail gold prices also fell on Monday morning in line with the drop in global rates. According to Dubai Gold and Jewellery Group, 24K gold price fell to Dh209.25; 22K to Dh196.75; 21K to Dh187.5; and 18K to Dh160.75.
"Yields are the big threat to gold in the near term. If the sell-off in bonds gathers momentum, gold could fall below $1,700 'very quickly," said Michael McCarthy, chief market strategist at CMC Markets.
"Gold seems to be caught between inflation expectations and higher interest rates... the lack of movement in gold is reflecting that indecision in the market at the moment, and consequently there's very little action," McCarthy said.
US Treasury yields held close to one-year highs reached on March 18, while the dollar began the week firmly as US economic strength and a Covid-19 vaccine rollout proceeding much more quickly than in Europe, drew investors into the greenback.
A stronger dollar makes greenback-denominated gold expensive.
(With inputs from Reuters)
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