Dubai Gold Prices Hover Near Three-Week Low; Global Rates Show Slight Uptick
Dubai, known as a global hub for gold trading, witnessed its gold prices remain close to the lowest levels seen in almost three weeks. While global rates demonstrated a modest increase, gold rates in the United Arab Emirates (UAE) maintained a relatively stable trajectory. The demand for gold jewellery in the UAE had experienced a decline during the April-June quarter compared to the previous year. The forthcoming report on the US non-farm payrolls for July is anticipated to exert influence over the near-term trend of gold.
As of the latest update, the 24K gold price in Dubai stood at 235.75 dirhams per gram, displaying no significant deviation from the previous night’s value. This consistency has brought the gold price to its lowest point in nearly three weeks. The price for 22K gold remained at 218.25 dirhams per gram, while 21K gold was priced at 211.25 dirhams per gram, and 18K gold at 181 dirhams per gram, according to the data provided by the Dubai Jewellery Group.
On the global stage, the prices of gold observed a slight uptick in response to Fitch’s downgrade of the United States’ triple-A credit rating. This alteration in credit rating enhanced the appeal of safe-haven investments, thereby contributing to the demand for gold. The value of gold edged up to $1,948.30 per ounce. Fitch, a prominent credit rating agency, recently lowered the US government’s credit rating from AAA to AA+, citing concerns over fiscal deterioration and the growing burden of general government debt. Gold, being favored as a safe-haven asset during times of economic uncertainty, tends to attract increased attention from investors seeking refuge.
Simultaneously, the dollar index experienced a minor decline, reaching 102.23. The previous Tuesday, gold had witnessed a decline, touching three-week lows as the dollar exhibited strength. Hareesh V, the Head of Commodities at Geojit Financial Services, provided insights into the dynamics of the gold market. He stated, “Gold prices slightly gained after the US government’s credit rating was downgraded by Fitch. Usually, economic uncertainties and dollar volatility can have significant impacts on the price and demand for gold as it is considered a safe-haven asset. The rating downgrade of the world’s largest economy tends investors to park their money in relatively safer assets like bullion.”
The global gold market’s responses to economic events and credit rating downgrades underscore the role of gold as a protective asset in times of financial volatility. The interplay between economic indicators, geopolitical events, and investor sentiment continues to shape the market dynamics of this precious metal.
In conclusion, Dubai’s gold prices, while maintaining proximity to a three-week low, are influenced by both local factors such as declining jewellery demand and global events like the US credit rating downgrade. The stability of gold prices in Dubai, coupled with its performance in the international market, showcases the intricate interplay between economic trends and investor behavior in the precious metals domain.
