Gold prices plunged more than Dh2 per gram in the UAE at the opening of the markets on Thursday.
The Dubai Jewellery Group data showed 24K trading at Dh244.0 per gram as compared to last night’s close of Dh246.25 per gram, down Dh2.25. Among the other variants of the yellow metal, 22K was opened at Dh226.0 per gram, 21K was at Dh218.75, and 18K was at Dh187.5.
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Globally, spot gold was trading at $2,016.0 per ounce by 9.10 UAE time. It hit a nearly one-week low of $2,011.06 in the previous session.
Rania Gule, market analyst at XS.com, said the price of gold remains confined within a narrow trading range while traders seek to understand more about the timing of the Federal Reserve’s interest rate cuts.
“I believe the focus will continue on the significant US economic calendar this week, such as fourth-quarter Gross Domestic Product (GDP) on Thursday and the Personal Consumption Expenditures (PCE) price index on Friday. These releases could lead to highly volatile price fluctuations upon their release,” she said.
Recently, investors have lowered their expectations for near-term monetary easing by the Federal Reserve following data indicating the resilience of the flexible US economy. Last week, several Federal Reserve officials emphasised the need for more inflation data before judging interest rates. This, in turn, helps the US dollar to stay above its highest level since December 13, breaking through at 103.70 points yesterday, which is a key factor directly impacting the price of gold. However, geopolitical tensions and concerns about an economic slowdown in China could support the strength of gold as a safe haven.
“It seems that investors are also hesitant to set strong directional expectations and prefer to wait and monitor the markets before the key US economic data,” she added.