Gold Hits New Heights Amid Middle East Uncertainty and U.S. Economic Shifts
Dubai’s gold prices have seen a notable increase this week, with 22K gold reaching Dh304 per gram as global gold prices surpassed $2,700 per ounce. The rise in prices has been attributed to a combination of geopolitical tensions in the Middle East and expectations of a U.S. rate cut, creating an environment of heightened demand for gold as a safe-haven asset.
On Thursday, Dubai Jewellery Group data revealed that 24K gold rose by Dh1.50 per gram to Dh328.50, marking an increase of Dh9.50 per gram since the beginning of the week. Other variants, including 22K, 21K, and 18K, also saw price hikes, with 22K hitting Dh303 per gram, 21K reaching Dh294.50, and 18K priced at Dh252.25 per gram.
Globally, gold was trading at $2,714.27 per ounce, despite a slight drop of 0.24%. Experts, such as Fadi Al Kurdi, founder and CEO of FFA Kings, pointed to a combination of factors supporting the rally. “Geopolitical tensions in the Middle East, particularly in Syria, have re-emerged as a significant driver of gold’s appeal, alongside expectations of a U.S. interest rate cut,” said Al Kurdi.
The latest U.S. economic data, which indicated a rise in nonfarm payrolls, has fueled speculation that the Federal Reserve may cut rates, resulting in subdued U.S. Treasury bond yields—another factor that benefits gold prices. In addition, central bank buying, particularly from China, has also contributed to the upward momentum. China’s decision to resume gold purchases for its reserves after a six-month hiatus has provided additional support for the yellow metal.
As central banks around the world continue to bolster their gold holdings and geopolitical uncertainties persist, analysts foresee continued strength in gold prices. This robust outlook suggests that gold could remain an attractive investment in the near term, driven by the ongoing demand for stability amid global economic and political volatility.
