Popular for lightweight everyday jewellery, 14-karat gold is trading below Dh300 at Dh297.50.
Dubai: Gold prices stabilised globally on Wednesday as lower oil prices helped ease some inflation concerns, while elevated US Treasury yields kept investors cautious.
In the UAE, gold rates saw little movement. 24-karat gold was priced at Dh501.25 per gram, remaining close to the Dh500 mark, while 22-karat gold traded at Dh464.25 and 18-karat gold at Dh381.50.
For shoppers looking for lighter, everyday jewellery, 14-karat gold remained below Dh300 at Dh297.50 per gram.
Internationally, bullion hovered around $4,180 an ounce after gaining 1.6 per cent in the previous session.
Oil prices, meanwhile, held on to recent declines as signs emerged that Middle East crude supplies were recovering towards pre-war levels. The improvement has been supported by Saudi Arabia increasing shipments through a key alternative pipeline, helping offset some of the disruption surrounding the Strait of Hormuz that had pushed fuel prices higher earlier in the week.
Despite the latest pullback, Brent crude has risen roughly 70 per cent this year as the regional conflict approaches its eighth month.
External factors continue to pressure gold
Oil is not the only factor weighing on gold. Rising US Treasury yields are also putting pressure on the precious metal.
The yield on the longest-dated US Treasury bond climbed for a sixth consecutive session on Tuesday, reaching its highest level since 2002. Investors are concerned that persistently high energy costs could keep inflation elevated and prompt further interest-rate increases this year.
Higher yields typically reduce gold’s appeal because bullion does not pay interest, making yield-bearing assets such as government bonds relatively more attractive.
Federal Reserve officials have also signalled that tighter monetary policy may still be necessary, even after the central bank raised interest rates in mid-September for the first time since 2023.
Markets are now turning their attention to the US personal consumption expenditures (PCE) data due later on Wednesday. The indicator is closely watched by the Federal Reserve as a measure of inflation.
Friday’s non-farm payrolls report will provide another important signal on the strength of the US economy and could further shape expectations for the Fed’s next move on interest rates.
For gold traders, both reports could prove important: stronger inflation or employment data could reinforce expectations of higher interest rates, while softer readings could ease some of the pressure currently weighing on bullion.
Gold is heading for a monthly decline of nearly 5 per cent, extending its six-month loss to 10.76 per cent.
Spot gold, however, edged 0.54 per cent higher to $4,170.40 an ounce at 9.30am Dubai time, indicating some support for bullion despite the broader downward trend.
Other precious metals were also slightly firmer. Silver gained 0.1 per cent to $61.54 an ounce, while platinum and palladium posted modest advances.
Meanwhile, the Bloomberg Dollar Spot Index, which tracks the US currency against a basket of major peers, was little changed after gaining 0.2 per cent in the previous session.
The steady dollar, elevated Treasury yields and expectations surrounding US interest rates remain key factors influencing precious-metal prices as traders await fresh economic data.
