As many Indians prepare for the auspicious Diwali festival, gold prices in Dubai saw a dip at the market’s opening on Thursday, continuing the decline that began during Wednesday evening’s session.
In recent months, gold prices have reached record highs, influenced by expectations of interest rate cuts from the US Federal Reserve, geopolitical tensions in the Middle East, and robust buying activity from China. The recent drop in prices is a welcome change for shoppers in Dubai just ahead of Diwali, when purchasing gold and precious metal jewelry is considered particularly fortunate.
At 9 AM UAE time on Thursday, the price of 24K gold fell to Dh331.25 per gram, down from Dh331.50 the previous night. The price peaked at an all-time high of Dh333 per gram on Wednesday morning.
Other gold variants also saw a decline: 22K dropped to Dh305.75, 21K fell to Dh296, and 18K decreased to Dh253.75 per gram.
Spot gold was trading at $2,727.32 per ounce, reflecting a 0.22% increase at 9:20 AM UAE time. However, this is down from $2,750 per ounce early on Wednesday. Vijay Valecha, Chief Investment Officer at Century Financial, noted that gold reached another record high due to the conflicts in the Middle East and the volatility surrounding the upcoming US election, which has heightened demand for safe-haven assets.
“Gold’s rally comes despite the US dollar clinging to a more than two-month peak as treasury yields rise. Strong US economic data has resulted in investors fearing that inflation might take longer to fall to the US Federal Reserve’s 2 percent target, resulting in a reduction of 50 bps rate cut probability for November. Investors now eagerly await the US PMI and initial jobless claims results, expected to be released on Thursday,” said Valecha.
