Dubai Gold Prices Plunge After UAE Central Bank Holds Interest Rate

Gold prices in Dubai took a hit on Thursday following the UAE Central Bank's decision to keep its benchmark interest rate unchanged. This move mirrored the US Federal Reserve's decision to leave rates on hold, which has seen global gold prices fluctuate.

The price of 24K gold in Dubai fell to Dh487.50 per gram at the market open on Thursday, down from Dh491.50 at the close of markets on Wednesday. Other variants, such as 22K, 21K, 18K, and 14K, also saw their prices drop.

Nick Spencer-Skeen, Senior Executive Officer of Lunaro Markets Limited, attributed the Fed's decision to keep rates unchanged to June's economic data, which showed core inflation cooling to 2.6 per cent year-on-year and payrolls coming in at just 57,000 against a forecast of 114,000.

Vijay Valecha, Chief Investment Officer at Century Financial, also weighed in on the decision, stating that it was consistent with recent economic data and the current state of the labour market.