UAE: Gold prices hit 8-month high; 22K crosses Dh210 per gram in Dubai

Gold prices advanced to an eight-month high on Monday morning, as a weaker dollar made greenback-priced bullion cheaper for overseas buyers while hopes of less-aggressive US rate hikes also lifted sentiment.

Spot gold was up 0.7 per cent at $1,878.55 per ounce.

In the UAE, the yellow metal prices jumped more than one dirham per gram at the opening of the markets.

The Dubai Gold and Jewellery Group data showed 24K trading at Dh227.25 per gram on Thursday morning, up from Dh226.0 per gram at the previous close.

While 22K, 21K and 18K also opened higher at Dh210.5, Dh203.75 and Dh174.75 per gram, respectively.

Christopher Wong, a strategist at OCBC FX, said softer US data on Friday boosted gold's appeal. "Data suggests that Fed's cumulative tightening in 2022 is starting to have its effects felt on the economy and that the Fed can afford to slow its pace of tightening," he said.

Data showed on Friday that the US economy added jobs at a solid clip in December, but Fed officials could draw some solace from a moderation in wage gains. Also, US services industry activity contracted in December for the first time amid weakening demand in more than 2-1/2 years, offering more evidence that inflation was abating.

Market participants will now turn to Fed chairman Jerome Powell's speech at a central bank conference in Stockholm on Tuesday and US consumer price index data due on Thursday.

"This week's CPI data would be key. Another deceleration in price pressures could boost the appetite for gold while the dollar stays under pressure. However, an unexpected uptick in CPI may un-nerve sentiments," Wong added.

-waheedabbas@khaleejtimes.com

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