Dubai, UAE – Gold prices in Dubai experienced a modest rebound on Friday morning, rising by Dh1 per gram following a significant drop the previous day.
The Dubai Jewellery Group reported that 24K gold was trading at Dh287 per gram, up from Dh286 at Thursday’s market close. This slight increase comes after a notable decline of more than Dh7 per gram on Thursday.
On Thursday, gold prices plummeted globally due to profit-taking by investors. The sharp decline saw 24K gold prices fall by Dh7.25 per gram, reflecting a broader trend of falling gold prices worldwide.
The other gold variants also saw changes in their trading prices, with 22K, 21K, and 18K gold trading at Dh265.75, Dh257.25, and Dh220.5 per gram, respectively.
Globally, spot gold prices were trading at $2,373.84 per ounce at 9:55 am UAE time, marking a 0.43 percent increase.
This rebound follows a drop below $2,370 earlier in the day. The fluctuations in gold prices reflect the current global market conditions and investor sentiment.
Mazen Salhab, chief market strategist for Mena at BDSwiss, provided insight into the recent volatility in gold prices.
Salhab noted that gold prices had dropped to their lowest point in two weeks on Thursday, following an attempt at recovery over the previous sessions.
“Gold declined on Thursday as market participants remain cautious ahead of key US economic data, which will likely offer insights into the Federal Reserve’s potential rate cuts this year,” Salhab explained.
Investors are closely watching the upcoming June PCE (Personal Consumption Expenditures) price index report, which is expected to shed light on the Federal Reserve’s future policy decisions.
“Due to the uncertainty, traders might avoid aggressive bets and wait for more clarity on the Fed’s policy direction.
Expectations of the Federal Reserve starting its rate-cutting cycle in September have kept the US dollar subdued, staying below a recent two-week high,” Salhab added.
Despite the short-term volatility, there are factors that could provide longer-term support for gold prices.
Salhab pointed to expectations of rising demand in India, ongoing geopolitical tensions, and concerns about an economic slowdown as potential factors that could support gold prices.
The “risk-off” sentiment in global equity markets, which often benefits safe-haven assets like gold, could also temporarily bolster gold prices.
Overall, while gold prices in Dubai saw a slight increase on Friday, the market remains influenced by global economic uncertainties and investor sentiment.
Traders and investors will be closely monitoring upcoming economic data and policy decisions to gauge the future direction of gold prices.