The gold rate in the UAE today: The price of gold in the UAE remained stable on Monday as international rates hovered near four-month highs.
In global markets, gold was trading near four-month highs as the dollar weakened on expectations that the US Federal Reserve would cut interest rates to support the economy. In early trade, spot gold was up 0.1% at $1,335.81 per ounce, having previously reached $1,338.56, its highest level since February 5.
U.S. gold futures were up 0.2% at $1,337 an ounce. Investors are also keeping a close eye on developments in the US-China trade war as the two countries prepare to hold fresh talks this week. Gold prices fell to a one-month low on Wednesday as the dollar strengthened and U.S. Treasury yields rose, making the metal less attractive to investors.
Higher rates tend to boost the dollar and push bond prices lower, increasing the opportunity cost of holding non-yielding bullion. “Gold prices have been pressured by a stronger U.S. dollar and higher Treasury yields,” said Mark To, head of research at Hong Kong-based metals consultancy APEX.
The United States and China have slapped tariffs on $34 billion worth of each other’s goods in a dispute over Beijing’s technology policies.
“The escalating trade tensions between the U.S. and China have driven up demand for safe-haven assets like gold, which has helped to support prices,” To said. Investors are also awaiting minutes from the U.S. Federal Reserve’s June policy meeting later in the day for clues on the central bank’s rate hike plans.
“The minutes could give us some insight into how Fed members are thinking about trade tensions and their potential impact on the economy,” To said. Spot gold may fall to $1,270 per ounce as it has found resistance at a Fibonacci retracement.
The dollar index rose to a one-week high against a basket of currencies, while U.S. Treasury yields jumped on growing expectations that the Federal Reserve will raise interest rates next month. Higher rates typically weigh on gold prices by increasing the opportunity cost of holding non-yielding bullion, while a stronger dollar makes gold more expensive for holders of other currencies.
Investors were also looking ahead to Friday’s U.S. non-farm payrolls report for clues on the strength of the economy and the likelihood of another rate hike later this year. Silver fell 1.1 percent to $16.39 per ounce after hitting a one-month low of $16.37 earlier in the session.Platinum fell 0.7 percent to $918 per ounce, while palladium fell 0.8 percent to $880.50 per ounce.
The Federal Open Market Committee’s (FOMC) decision to keep interest rates unchanged at its September meeting weighed on the gold price in the United Arab Emirates (UAE), with the metal falling to a one-week low. Gold was trading at AED 1,869 per gramme on September 27, after hitting a high of AED 1,917 per gramme on September 21. The metal fell to its lowest level since 20 September as the FOMC’s decision to keep rates unchanged dented demand for the safe-haven asset.
The committee’s next meeting is scheduled for November, and with no rate hike expected at that meeting either, gold prices are likely to remain under pressure in the near term. However, longer-term factors such as geopolitical tensions and central bank buying are expected to provide support for prices.
The UAE gold price is closely linked to international gold prices, which have come under pressure in recent months as the US dollar has strengthened and concerns about a global economic slowdown have eased.
