( Image caption: Gold shoppers visit stores in Dubai’s Gold Souq amid rising prices and investment demand. Photo: Shihab.)
Gold prices in Dubai climbed on Monday morning, with 24-karat gold trading above Dh500 per gram as the precious metal recovered from recent selling pressure.
According to Dubai Jewellery Group data, 24K gold was priced at Dh504.25 per gram, up Dh2.25 from its weekend closing price of Dh502.
Other gold varieties also recorded gains, with prices rising across the market.
UAE Gold Prices on October 19
The latest retail gold rates in Dubai were:
- 24K gold: Dh504.25 per gram
- 22K gold: Dh467 per gram
- 21K gold: Dh447.75 per gram
- 18K gold: Dh383.75 per gram
- 14K gold: Dh299.25 per gram
Internationally, spot gold was trading at $4,178.40 per ounce, up 0.42 per cent as of 9:17am UAE time. Silver also gained, rising 1.46 per cent to $57.63 per ounce.
US Inflation Data Drives Gold Market Volatility
Precious metals experienced another volatile week after a stronger-than-expected US inflation report triggered selling pressure on gold, according to Ole Hansen, head of commodity strategy at Saxo Bank.
However, a subsequent decline in US Treasury yields and the dollar helped support prices, leaving gold little changed over the week.
“Despite the correction from last year’s record highs, underlying investment demand remains resilient. Gold is showing tentative signs of breaking its recent downtrend. In our view, a sustained recovery above $4,235 would provide further evidence that the corrective phase is ending,” Hansen said.
He added that the sustainability of a recovery would partly depend on momentum-driven traders, including hedge funds, switching from net selling to net buying.
Renewed speculative buying, combined with resilient demand for gold-backed exchange-traded funds (ETFs), could provide additional support for prices.
Lower Yields Could Support Precious Metals
Declining yields, driven partly by concerns over economic growth and equity valuations, could create a more supportive environment for precious metals.
Silver, however, faces a different set of risks because of its industrial applications.
“Silver’s industrial exposure leaves it vulnerable to weaker risk sentiment, but its dual role as an industrial and precious metal could become an advantage if lower yields, a softer dollar and renewed investor interest outweigh growth concerns,” Hansen said.
For gold, market participants will be watching whether prices can sustain a recovery above $4,235 an ounce, a level Hansen identified as an important indication that the recent corrective phase may be ending.
