Gold prices recovered in Dubai and globally on Thursday morning after plunging by more than one per cent late on Wednesday.
However, the price of 24K gold remained below Dh500 per gram despite the recovery.
According to Dubai Jewellery Group data, 24K gold was trading at Dh499.75 per gram at the market open on Thursday, up from Dh492.75 per gram at Wednesday’s market close.
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Among the other variants of the yellow metal, 22K, 21K and 18K gold were trading at Dh462.75, Dh443.50 and Dh380.25 per gram, respectively.
The dip in gold prices has come as welcome news across the UAE, where the Indian community, the country’s largest expatriate group, is preparing for the festive season. With Dhanteras and Diwali approaching, buying gold is considered auspicious, and families traditionally purchase coins, bars and jewellery for good fortune. Lower prices help stretch household budgets, allowing shoppers to buy more gold or upgrade to heavier pieces.
On Thursday morning, spot gold was up 1.4 per cent at $4,144 an ounce, while silver was up 0.4 per cent at $205.70 an ounce.
Gold fell by more than one per cent late on Wednesday as a stronger-than-expected inflation reading increased expectations of a US Federal Reserve rate hike this month.
Simon-Peter Massabni, head of business development at XS.com, said gold was navigating a challenging landscape shaped by monetary policy pressures, geopolitical risks and shifting inflation expectations.
“Gold’s current price action cannot be explained simply by its recent decline or its proximity to specific support levels. Instead, it must be assessed within a broader macroeconomic framework in which the strength of the US dollar, interest rate expectations and demand for safe-haven assets are competing to determine the metal’s next move,” Massabni added.