Gold prices in Dubai hit a new record high on Tuesday afternoon, surpassing Dh305 per gram.
According to Dubai Jewellery Group data, the 24K jumped Dh3 per gram to Dh305.75 per gram on Tuesday afternoon, an all-time high for the precious metal variant.
Similarly, 22K, 21K and 18K also reached an all-time high, selling at Dh283.25, Dh274.0 and Dh235.0 per gram, respectively.
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Globally, spot gold was trading at $2,525.01 per ounce, up 0.86 per cent, at 4.10pm, driven higher by US Federal Reserve rate cut expectations.
Mohamed Hashad, chief market strategist, Noor Capital, said the past week has witnessed a notable rebound in equity markets, with the S&P 500 and the Canadian TSX surging over 6.5 per cent and 5 per cent, respectively, from their August 5 lows. This resurgence appears to be primarily driven by two key factors: a continued moderation in inflation and a resilient economic performance, particularly in the US.
“Traders and analysts alike highlighted these factors as key contributors to gold’s surge. The metal’s performance was further enhanced by recent data suggesting a potential slowdown in inflation, which could pave the way for the Fed to adopt a more accommodative monetary policy. While gold captured the spotlight, other precious metals exhibited mixed performance,” he said.
“As investors look ahead, the upcoming Jackson Hole economic symposium, where Fed Chair Jerome Powell will deliver a speech, is expected to provide crucial insights into the central bank’s future monetary policy direction. Gold’s record-breaking performance reflects a confluence of economic and geopolitical events, making it a sought-after asset for investors seeking both returns and protection,” added Hashad.
Chris Weston, head of research at Pepperstone, said there is a view that Fed Chair Jerome Powell’s speech at Jackson Hole is the landmine that could rock US rates and will then prove to be the big risk that drives the yellow metal.
“However, while we always hold an open mind to the price moves that could play out, and react as objectively as possible – my base case is that Powell’s tone will hit the market pricing almost perfectly. So in theory, the US swaps and Treasury markets shouldn’t get a shock – so for those positioned in gold for Powell to lean towards a 50bp cut then they may get a look to pare back,” he said.