Dubai: Price of the yellow metal dipped below the $4000 mark in early trade on Friday, sliding to the lowest in more than three months. Investors dumped gold as stocks fell across global markets.
In the UAE, prices of gold have seen over a Dh20 drop in just 5 days. At the start of the week 24-karat gold was priced at Dh504.25, this is currently priced at Dh482.75. 22-karat is trading below the Dh450 levels, while 18-karat is priced at Dh367.50 and 14-karat at Dh286.50.
Bullion fell as much as 0.9% to below $3,990 an ounce, its weakest level since mid-July, extending a near 3 per cent drop on Thursday. The metal later recovered some of those losses. Stocks extended their slump on Friday as investors exited AI-related names and bought US government bonds, which largely held onto Thursday’s gains.
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Policy change to guide gold trajectory
All eyes are now on the upcoming Fed policy meet. “Gold edged lower as rising oil prices revived inflation concerns and reinforced hawkish monetary policy expectations ahead of next week’s Federal Reserve meeting” said Ranim Turfa, Head of Research and Market Analysis, MENA, at Tickmill.
Markets widely expect the Federal Reserve to leave rates unchanged this month, but traders still price in a hike in December. Bets on more tightening in 2027 add to the pressure on gold. “Whether those hikes materialize this year or next is likely to remain the key driver of sentiment towards the metal,” he added.
On a technical perspective analysts are keeping $4,000 as the level to watch. A clean break below it could set off more long liquidation and drag gold toward $3,960. To signal a recovery, the metal needs to reclaim $4,100 to $4,110.
Dilin Wu, Research Strategist at Pepperstone, stays constructive over the medium term, pointing to central bank demand and gold’s appeal as a hedge against fiscal risks. “But we need to see selling pressure ease and buyers return before becoming more confident in a sustained recovery,” Wu said.
Spot gold was down 0.76 per cent to $4,013.83 an ounce at 10:45 am in Dubai, while silver fell 1.55 per cent to $54.09 an ounce. Platinum and palladium edged higher. The Bloomberg Dollar Spot Index, a gauge of the US currency, was little changed.