Dubai gold prices lose Dh10.75 in a month, giving investors relief amid Diwali shopping

Gold prices in Dubai fell on Wednesday morning, offering some relief to buyers ahead of Diwali. The 24K gold rate dropped to Dh486.5 per gram, down from Dh489 at Tuesday's market close.

The precious metal has lost Dh2.5 per gram so far this week and Dh10.75 over the past month, making the price movement significant for shoppers planning to buy gold during the festive season.

Dubai Gold Rates on Wednesday

The prices of all major gold variants traded lower on Wednesday morning. The rates per gram were:

24K gold: Dh486.5
22K gold: Dh450.5
21K gold: Dh432
18K gold: Dh370.25
14K gold: Dh288.75

The decline comes at a time when many buyers traditionally purchase gold for Diwali celebrations and gifting.

Global Gold and Silver Prices Decline

International precious metal prices also moved lower on Wednesday.

As of 9:40 am UAE time, spot gold fell 0.66% to $4,034.46 per ounce. Silver prices declined 0.98% to $53.92 per ounce.

Market participants continue to monitor economic indicators, geopolitical developments and US monetary policy for clues about the direction of precious metal prices.

Ross Maxwell, Chief Strategy Officer at VT Markets, said gold continues to benefit from structural demand, including central bank purchases and geopolitical uncertainty.

These factors have supported the precious metal despite short-term price fluctuations. Investors often turn to gold during periods of economic or political uncertainty, although its price can also respond to changes in interest rates and currency movements.

US Midterm Elections Could Influence Gold Prices

The US midterm elections scheduled for November 3 could become an important catalyst for financial markets. Investors are assessing how changes in congressional control might affect fiscal policy, inflation and interest rates.

Maxwell said a divided Congress could support gold if expectations of lower fiscal expansion lead to reduced bond yields and a weaker US dollar. Such developments could strengthen gold's outlook beyond temporary demand for safe-haven assets around Election Day.

However, the outcome will depend partly on how election results compare with market expectations.

Despite the factors supporting gold, persistent inflation and a hawkish US Federal Reserve could limit its recovery.

Higher real yields can make interest-bearing assets more attractive than gold, which does not generate interest. A stronger US dollar can also put pressure on gold prices.

Maxwell noted that a more convincing bullish signal would emerge if gold established higher price highs while real US Treasury yields and the US Dollar Index declined.

What Gold Buyers Should Watch Ahead of Diwali

Dubai's lower gold prices may offer buyers an opportunity ahead of Diwali, but further movements will depend on global market conditions.

Buyers should monitor daily retail rates, compare jewellery prices and account for making charges and other applicable costs before making a purchase. Gold prices can change throughout the trading day, so checking the latest rate before visiting a jewellery store is advisable.