UAE: Gold prices plunge in Dubai in early trade

They were weighed down by a strong dollar after better-than-expected US retail sales data clouded hopes of a smaller rate hike



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A Staff Reporter

Published: Thu 17 Nov 2022, 10:17 AM

Gold prices plunged on Thursday morning in the UAE and worldwide, weighed down by a strong dollar after better-than-expected US retail sales data clouded hopes of a smaller rate hike, while safe-haven demand from latest geopolitical concerns also faded.

Spot gold was down 0.6 per cent at $1,763.38 per ounce at 9.45 am UAE time.

In the UAE, gold prices fell Dh1.75 per gram at the opening of the markets on Thursday. The 24K gold price fell to Dh213.5 per gram as compared to its last night’s close of Dh215.75. While 22K, 21K and 18K also opened lower at Dh200.5, Dh191.5 and Dh164.0 per gram, respectively.

"Gold has had an excellent run, but having struggled to push above $1,790 it has succumbed to the strength of an oversold US dollar and seemingly entered a retracement," said City Index analyst Matt Simpson.

"Gold can pull back further given the magnitude of its prior rally, which is likely to tempt profit-taking and entice a few countertrend bears around these highs," he said.

Edward Moya, a senior market analyst at Oanda, said the dollar rout is near key technical levels, so gold might be ready to soften a little bit here.

“Gold will eventually act like a safe haven, but right now its primary catalyst is the Fed’s rate hike path, which dictates the direction of the dollar. Today’s hawkish round of Fed speak put some pressure on bullion as policymakers push back on traders who are making calls for a pivot,” said Moya.

-waheedabbas@khaleejtimes.com

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