In Dubai, gold prices have soared to unprecedented levels, with 24K gold surpassing Dh420 per gram. Late on Monday, the Dubai Jewellery Group reported that 24K gold reached Dh422.25 per gram, breaking the previous record high of Dh420.
Other gold variants also saw significant trading, with 22K at Dh391.25 per gram, 21K at Dh375.0, and 18K at Dh321.25.
On Tuesday morning, spot gold traded at $3,495.79 per ounce, marking a 1.39% increase.
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The surge in gold prices is causing a dilemma for buyers and traders in deciding whether to buy, sell, or hold their investments. Many UAE residents, especially those from Asian backgrounds, purchase gold coins, bars, and jewelry for cultural, economic, and practical reasons.
Economically, gold is considered a stable and secure investment. In the UAE, gold is often seen as a means to preserve wealth for future generations. Moreover, gold jewelry serves as both decoration and a form of wealth that can be easily liquidated when needed.
The rise in gold prices over recent years has been largely driven by central banks’ acquisitions, falling interest rates, global geopolitical tensions, and trade disputes.
Analysts predict that if geopolitical tensions, trade disputes, and central banks’ buying continue, gold prices will keep rising in Dubai and worldwide.
Samer Hasn, a senior market analyst at xs.com, noted that the immediate catalyst is the increasing belief that the US Federal Reserve will cut rates by September, amid pressure from Donald Trump, while broader equity markets lose momentum as excitement over artificial intelligence wanes.
“These factors have bolstered gold’s appeal as investors hedge against monetary and equity market uncertainties,” Hasn stated, adding that labor market data will take center stage this week.
“A weaker jobs report could cement expectations of a rate cut, putting pressure on the dollar, which is already at a five-week low, while a stronger report could dampen market expectations and impact gold prices,” Hasn added.
The World Gold Council points out that gold has historically shown increased sensitivity to monetary policy expectations around the annual Jackson Hole Economic Symposium, and this year is no exception.
