In the wake of easing geopolitical tensions in the Middle East, gold prices witnessed a decline in the UAE markets on Tuesday, shedding more than Dh10 per gram over the past 24 hours.
According to data from the Dubai Jewellery Group, the 24K variant of the precious metal lost Dh4 per gram from Monday morning, trading at Dh279.25 per gram on Tuesday, compared to Dh283.25 per gram at Monday’s market close.
This marks a significant decrease, with the variant losing Dh6.25 per gram on Monday alone, culminating in a total drop of Dh10.25 per gram since the beginning of the week.
Among other variants, the 22K opened at Dh258.5, 21K at Dh250.25, and 18K at Dh214.5 per gram, reflecting a broader decline across different grades of gold.
At 9.05 am UAE time on Tuesday, spot gold was down 1.19% at $2,305.84 per ounce as investors opted to book profits following a robust rally witnessed over the past few months. The decline also comes amidst easing concerns of escalation in the Middle East region.
Commenting on the market movement, Vijay Valecha, Chief Investment Officer at Century Financial, noted that gold retraced its gains as geopolitical tensions in the Middle East eased.
Valecha highlighted, “The bullion has enjoyed a 5-week rally – which marks its longest winning streak in over a year. Haven’s demand for the precious metal moderated after the Iranian regime downplayed Israel’s counterattack and did not signal retribution.”
With the focus shifting to economic indicators, attention now turns to the upcoming release of the US Federal Reserve’s preferred inflation gauge, the PCE Price Index report, scheduled for Friday.
Analysts anticipate a slight uptick in March’s reading to 2.6% from February’s growth rate of 2.5%. This expectation, according to Valecha, could typically signal a bearish trend for gold.
However, despite the prospect of a delayed Fed pivot to rate cuts, gold prices have surged nearly 15% as of Monday this year.
This rise has occurred despite a stronger greenback and higher treasury yields, with the commodity buoyed by haven demand, central bank purchases, and a revival in demand from Asia.
The decline in gold prices in the UAE markets reflects a broader trend influenced by global economic indicators and geopolitical developments.
As investors continue to monitor market dynamics, including inflation data and geopolitical tensions, the trajectory of gold prices remains subject to fluctuation.
In summary, while gold prices in the UAE experienced a decline amid easing geopolitical tensions and profit-taking by investors, the market outlook remains influenced by a range of factors including economic data releases and global geopolitical developments.
This article was created using automation and was thoroughly edited and fact-checked by one of our editorial staff members