UAE: Gold prices jump nearly Dh2 after hitting 3-week low

Gold prices bounced back in the UAE on Thursday morning, jumping nearly two dirhams per gram after they hit three-week lows late on Monday.

The Dubai Jewellery Group data showed 24K trading at Dh246.25 per gram on Tuesday morning as compared to last night’s close of Dh244.5 per gram, up by Dh1.75 per gram. Among the other variants of the yellow metal, 22K opened higher at Dh228.0, 21K at Dh220.75 and 18K at Dh189.25 per gram.

Spot gold was up 0.3 per cent at $2,034.49 per ounce, helped by a pullback in the dollar after an official US report showed that consumers expected lower inflation cemented bets for interest rate cuts from the Federal Reserve.

Rania Gule, market analyst at XS.com, said the markets are still pricing in a greater chance of the Fed’s first interest rate cut at its March policy meeting, followed by cumulative interest rate cuts by 25 basis points for 2024. “This prevents a strong rise in the US dollar, providing some support for the gold price.”

She added that the generally weaker risk tone in the markets should act as a supportive force for the rise of precious metals considered a haven. “The markets are eagerly awaiting the speech scheduled to be delivered by the President of the Federal Reserve Bank of Atlanta, Raphael Bostic, to gain some momentum in the absence of significant data until the release of the Consumer Confidence Index on Thursday and the Producer Price Index on Friday,” said Gule.

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