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UAE: Gold prices slightly recover; 22K still trades below Dh200 per gram

Spot gold was trading at $1,779.4 per ounce, up by 0.16 per cent at 10.13am UAE time

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Gold prices were slightly up on Friday morning after sinking around 1.7 per cent on Thursday, marking the worst single-day performance in three months.

The yellow metal was pressured by expectations of higher interest rates for a longer period by the US Federal Reserve.

Spot gold was trading at $1,779.4 per ounce, up by 0.16 per cent at 10.13 am UAE time.

In the UAE, the 22K gold price fell below Dh200 per gram yesterday and still opened below the threshold on Friday morning despite a slight increase in price.

The Dubai Gold and Jewellery Group data showed 24K trading at Dh215.25 per gram as compared to last night’s close of Dh215.0 per gram. While 22K, 21K and 18K opened at Dh199.5, Dh193.0 and Dh165.5 per gram, respectively.

The Fed on Wednesday raised interest rates by 50 basis points as expected, but Fed Chair Jerome Powell said the central bank would deliver more rate hikes next year even as the economy slips towards a recession.

Although gold is traditionally known as a hedge against inflation and economic uncertainties, higher interest rates tend to dim the bullion's appeal as it increases the opportunity cost of holding the non-yielding metal.

-waheedabbas@khaleejtimes.com

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