Dubai gold prices steady in early trade after losing half a dirham
Gold prices in Dubai remained steady in early trade on Wednesday, following a slight dip of half a dirham per gram the previous day. As of 9am UAE time, the 24K variant of gold was trading at Dh280.75 per gram, while 22K, 21K, and 18K were priced at Dh260, Dh251.75, and Dh215.75 per gram, respectively.
Spot gold prices were also relatively stable, trading at $2,319.04 per ounce, showing a minor increase of 0.17 percent at 9:10am UAE time.
According to Terence Hove, a senior financial market strategist at Exness, gold prices have experienced some pressure since reaching a peak in early April. However, the recent US Nonfarm Payrolls (NFP) data has led to expectations that the Federal Reserve (Fed) could implement interest rate cuts sooner than anticipated, with markets forecasting the possibility of a rate cut as early as September.
The anticipation of an easing cycle and lower interest rates could provide support for gold prices, although market sentiment may be influenced by comments from Federal Reserve members. A hawkish tone from Fed officials could strengthen the US dollar and potentially weigh on gold.
Additionally, central bank gold purchases may continue to provide support for the precious metal. While central banks have been net buyers for several months, the volume of purchases has decreased somewhat, posing certain risks. Geopolitical tensions in the Middle East could also contribute to volatility in gold prices, with a potential escalation in tensions leading to increased demand for safe-haven assets like gold.
Overall, while gold prices may experience fluctuations in the short term, factors such as interest rate policies, central bank purchases, and geopolitical developments will likely continue to influence market dynamics and shape the trajectory of gold prices in the coming days.
By: Sahiba Suri
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