24K gold rose to its highest level this month after global bullion prices advanced.
Dubai: Gold prices in Dubai climbed by more than Dh11 on Wednesday morning, pushing local rates to their highest level so far this month.
The 24-karat variety was priced at Dh560 per gram at 9:17 am, up from Dh548.50 on Tuesday. The 22-karat variety also rose to Dh518.75 from Dh508.
The increase means jewellery buyers in Dubai are now paying Dh11.50 more per gram for 24K gold and Dh10.75 more per gram for 22K gold compared with Tuesday’s prices.
Gold prices in Dubai have fluctuated through the beginning of May. The 24K rate was Dh557.50 on May 1, slipped to Dh556 on May 2 and 3, fell further to Dh546 on May 4, recovered to Dh548.50 on May 5, and then rose to Dh560 on Wednesday.
The 22K rate followed a similar trajectory, starting the month at Dh516.25, easing to Dh514.75 for two days, dropping to Dh505.50 on May 4, recovering to Dh508 on Tuesday, and rising to Dh518.75 on Wednesday morning.
Wednesday’s gains pushed both 24K and 22K gold to their highest levels so far this month.
Global gold gains
Gold also extended gains globally after US President Donald Trump said progress had been made on a final agreement with Iran, while the US dollar weakened.
Bullion rose by as much as 1.6% to near $4,630 an ounce, following a 0.8% gain on Tuesday. The dollar index fell 0.3%, making gold cheaper for buyers using other currencies.
Trump said in a social media post that “great progress” had been made toward a final agreement with Iran, adding that he would temporarily pause a US-led effort to help stranded ships exit the Strait of Hormuz so talks can be concluded.
According to his post, the pause is intended to allow space to determine whether a deal can be finalised, while negotiations continue.
US Defense Secretary Pete Hegseth said the truce that began just under a month ago was holding, while Secretary of State Marco Rubio stated that offensive operations had ended and Washington was now focused on protecting shipping in the Strait of Hormuz. Iranian Foreign Minister Abbas Araghchi also said that talks were “making progress.”
Hormuz uncertainty remains
Despite diplomatic signals, tensions persist in the region. Reports indicated that a cargo vessel was struck by an unidentified projectile a day after earlier ship-related clashes in the Strait of Hormuz, underscoring continuing instability in the area.
The path to a deal that fully reopens the Strait remains uncertain, keeping gold prices influenced by inflation concerns and shifting expectations around US interest rates.
Bond markets are increasingly pricing in the possibility that the US Federal Reserve’s next move could be a rate hike rather than a cut. Higher interest rates typically weigh on gold, as bullion does not generate yield.
Gold has declined by more than 12% since the conflict began in late February.
Expectations of a potential rate increase are building ahead of the upcoming US employment report, which may indicate stabilising labour market conditions and shift inflation risks back into focus for investors.
