Gold prices in Dubai saw a slight increase on Tuesday morning, opening half a dirham higher per gram compared to Monday’s closing rates.
At 9:00 AM, the price of 24K gold reached Dh317.25 per gram, up from Dh316.25. Other variants also recorded increases, with 22K at Dh293.75, 21K at Dh284.5, and 18K at Dh243.75 per gram.
Globally, spot gold was trading at $2,620.73, marking a 0.34% rise.
Global Factors Impacting Gold Prices
Gold prices dipped on Monday after gaining some recovery last week. This drop was linked to the strengthening of the US dollar and Treasury yields, which rebounded following corrections last Friday.
Samer Hasn, a senior market analyst at XS.com, noted:
“The pressure comes from growing concerns about the Federal Reserve’s slow pace of interest rate cuts expected next year. These worries have resurfaced since Donald Trump secured a second term in the White House, as his policies may reignite inflation concerns.”
Despite inflation expectations and interest rate concerns, the US economy remains strong. The economy grew by 3.1% in the fourth quarter, exceeding predictions. Additionally, the service sector performed better than expected, along with improvements in building permits and home sales.
Hasn further explained:
“Accelerating US economic growth could continue to weigh on gold, reducing uncertainties tied to tighter monetary conditions. The US economy has proven adaptive.”
Geopolitical Influence on Gold Prices
In the Middle East, geopolitical tensions have been a key factor in gold’s performance. However, Hasn anticipates that this influence will gradually diminish. As a result, the premium gained by gold due to geopolitical risks may decline over time.
