Dubai gold prices slip ahead of Indian festive season

Gold prices in Dubai continued their downward trend on Tuesday, influenced by a stronger US dollar and rising Treasury yields. The price of 24K gold dropped to Dh496.75 per gram at the market open, down from Dh498.50 per gram the previous day. Over the past month, the metal has lost Dh37 per gram. Other variants also saw declines, with 22K, 21K, and 18K gold priced at Dh460.00, Dh441.00, and Dh378.00 per gram, respectively. Spot gold fell 0.18 per cent to $4,122 an ounce.

The price drop comes just ahead of the Indian festive season, including Navratri, Dhanteras, and Diwali. Some expatriate and non-resident Indian families are taking advantage of the lower prices, making early purchases. However, Chris Weston, head of research at Pepperstone, noted that the short-term investment case for gold remains challenged.

Weston highlighted that gold prices continue to trend downward, with sellers in control. He predicted a potential break below $4,110, which could accelerate selling towards $4,100 or even $4,000. To shift the outlook, Weston suggested that gold would need to break above $4,275. He attributed the weakness to the increasing opportunity cost of holding gold, citing strong US dollar support and high real yields as significant headwinds.