Gold prices rose in the UAE on Wednesday morning after dropping one dirham per gram on Tuesday evening.
According to Dubai Jewellery Group data, the 24K opened higher at Dh233.75 per gram on Wednesday as compared to last night’s close of Dh233.25. While 22K, 21K and 18K were trading at Dh216.5, Dh209.5 and Dh179.5 per gram, respectively, at 9 am UAE time.
Spot gold was up 0.32 per cent at $1,931.64 per ounce by 9.40 am UAE time.
Bas Kooijman, CEO and asset manager of DHF Capital, said gold prices recorded some volatility as markets turned to more caution as traders digested the US credit rating downgrade as well as the economic data in Europe and the US.
“Gold has been on a rebound since the beginning of July but could come under pressure as some uncertainty takes over. The credit rating downgrade has fueled mixed reactions on the market and could push some investors toward safer assets including gold,” he said.
While concerns about a recession in the US have been declining in particular after the Federal Reserve announced it didn’t forecast one anymore, traders could continue monitoring economic developments in the US as well as the path of US monetary policy, said Kooijman.
“The time gap until the next monetary policy meeting in the US could leave some room for uncertainty which could impact gold’s performance and could fuel volatility. In this regard, gold could be exposed to the downside if traders’ expectations move toward more interest rate hikes in the near future,” he added.
Sources: Khaleej Times
