Dubai Gold Prices Dip as US Inflation Expectations Shift
Gold prices in Dubai started the week on a downward trend, with the precious metal experiencing a slight dip. According to data by Dubai Jewellery Group, the 24K variant of gold was trading at Dh530 per gram at market open on Monday, down from Dh533.75 at Friday's close. The other variants, including 22K, 21K, 18K, and 14K, also saw a decrease in price.
Globally, spot gold was trading at $4,402.4 per ounce, down 0.53 percent as of 9:11am UAE time. Silver followed suit, trading at $65.83 per ounce, also down by 0.53 percent. Vijay Valecha, CIO of Century Financial, attributed the decline to shifting expectations for U.S. monetary policy.
Federal Reserve Governor Christopher Waller's indication that he would favor keeping interest rates unchanged if inflation continues to moderate reduced expectations of an imminent rate hike. However, markets still price a 50 percent chance of a Fed hike later this month. A weaker-than-expected payrolls figure could strengthen expectations for a Fed pause and provide further upside for gold.
Simon-Peter Massabni, Head of Business Development at XS.com, stated that although gold remains under defensive pressure, the fundamental backdrop continues to offer support, particularly amid ongoing uncertainty surrounding the U.S. interest-rate path and elevated geopolitical risks. He views the current pullback as a corrective move and a period of repositioning ahead of the release of the U.S. data.