Analysts said the precious metal came under pressure as investors reassessed expectations for US monetary policy and moved towards higher-yielding assets.
Gold prices in Dubai dropped sharply on Wednesday morning, extending recent declines and keeping the precious metal below the Dh500-per-gram mark, making it more appealing for jewellery buyers and investors in the UAE.
24K gold was trading at Dh489.75 per gram at the start of the day, down from Dh498.75 per gram at Tuesday’s close, marking a fall of Dh9 per gram.
Other variants of the precious metal also traded lower, with 22K gold priced at Dh453.50 per gram, 21K gold at Dh434.75 per gram, another 21K category at Dh372.75 per gram, and 18K gold at Dh290.75 per gram.
spot gold slipped below $4,100, trading at $4,089 per ounce and declining 1.01%, while silver was priced at $62.12 per ounce.
Analysts said gold came under pressure as investors reassessed expectations for US monetary policy and rotated into higher-yielding assets. Vijay Valecha noted that sentiment weakened after Deutsche Bank reduced its gold price forecasts by up to 22%, reflecting concerns about interest rate trends and softer investment demand for safe-haven assets.
He explained that higher interest rates reduce the appeal of non-yielding assets like gold, while encouraging flows into fixed-income investments. Broader equity market weakness also contributed to volatility, with South Korea’s Kospi index seeing its steepest fall in months amid technology-led selling and ETF-driven rebalancing pressures.
From a technical standpoint, he said gold has pulled back after failing to break resistance and is now testing support around $4,115–$4,117. A sustained break below this level could push prices toward $4,050, while a rebound could see a recovery toward $4,175. The metal remains volatile as markets balance interest rate expectations, growth concerns, and shifting safe-haven demand.
