Gold prices in Dubai saw a recovery on Wednesday morning after a sharp decline the previous day. The price of 24K gold increased by Dh1 per gram, trading at Dh317 per gram at 9 a.m., according to the Dubai Jewellery Group. This rise follows a Dh4 per gram drop on Tuesday. Other gold variants also saw gains, with 22K trading at Dh293.5, 21K at Dh284, and 18K at Dh243.5 per gram.
On the global front, spot gold remained steady, trading at $2,620.57 per ounce at 9:10 a.m. UAE time. The recent drop in gold prices, which saw a decline of over 1% on Tuesday evening, was largely attributed to diminished expectations of a significant rate cut by the U.S. Federal Reserve.
In September, the U.S. Federal Reserve began its interest rate-cutting cycle, lowering the federal funds rate by 50 basis points (bps), with indications of further cuts in 2025. The rate cuts, particularly within the context of inflation in the MENA region and declining oil prices, were generally well-received.
Gold prices recently reached an all-time high, but have since seen some retreat, falling from $2,670 to $2,620 per ounce over the past few weeks. However, analysts remain optimistic about the precious metal’s future performance. They predict that gold could hit $2,700 in November, driven by uncertainties surrounding the U.S. elections and potential further interest rate cuts by the Federal Reserve. Additionally, experts expect the price of gold to climb to $3,000 per ounce in the first quarter of 2025.
Dubai’s gold market continues to be influenced by global economic factors, with investors closely monitoring developments in the U.S. Federal Reserve’s monetary policy and its impact on the value of the U.S. dollar. The UAE’s gold market, known for its strong retail demand, has been a significant hub for gold trading, and analysts believe the current fluctuations may offer buying opportunities for investors.
With gold prices remaining volatile, the coming months will likely see continued interest in the precious metal as global financial markets brace for potential shifts in monetary policy and geopolitical developments.
