Precious metal prices were heading for a third consecutive weekly decline, making gold jewellery more affordable for visitors and residents in Dubai and the UAE.
Gold prices plunged in Dubai on Friday morning, with 24K slipping below Dh500 per gram and making gold jewellery more affordable for shoppers in Dubai and the UAE.
The 24K gold rate stood at Dh496.75 per gram at the opening of markets on Friday, down from Dh509.25 at Thursday’s close — a decline of Dh12.50 per gram.
The 22K variant of the precious metal fell Dh11.50 to Dh460.00 per gram in early trade. Meanwhile, 21K, 20K, and 18K gold were also trading lower at Dh441.25, Dh378.00, and Dh295.00 per gram, respectively.
Spot gold fell below $4,200, trading at $4,123 an ounce, down 2.4 per cent. Silver also declined more than four per cent to $63.63 an ounce.
The precious metals were pressured by hawkish signals from the US Federal Reserve and a stronger dollar, while the US–Iran ceasefire deal — which eased inflation concerns and weighed on oil prices — also helped cap gains.
Gold was on track for a third consecutive weekly loss on Friday.
Ahmad Assiri, Research Strategist at Pepperstone, said gold is currently taking its cues from monetary policy, with the Federal Reserve’s latest meeting reinforcing a hawkish stance that has weighed on investor sentiment.
“While policymakers left rates unchanged, markets interpreted the accompanying press conference as relatively hawkish, prompting investors to reassess the likelihood of borrowing costs remaining elevated for an extended period, with a now 40 per cent probability of a rate hike at the next FOMC meeting. This has pushed US Treasury yields and the US dollar higher, creating a challenging backdrop for the precious metal. Gold becomes less attractive when investors can earn stronger returns from fixed income securities, while a firmer dollar above the 100 mark also makes bullion more expensive for international buyers,” he said.
Although geopolitical risks remain present, he added, they appear to be a less dominant driver of price action.
“Instead, investors are focusing on whether incoming US economic data will justify the Federal Reserve maintaining restrictive policy under the Warsh era or reviving expectations for easing back to pre-Iran conflict levels.”
Assiri also noted that inflation dynamics present a complex picture, but remain the more pressing side of the Fed’s mandate.
“Hence, persistent price pressures are repricing expectations for tight monetary policy in the coming months, likely limiting gold’s upside potential in the current environment,” he added.
