Gold prices rose in the UAE on the first trading day of the New Year, rising by Dh0.75 per gram on Tuesday.
According to Dubai Jewellery Group data, the 24K variant of the yellow metal opened at Dh250.5 per gram, up from Dh249.75 per gram at the close of the markets last week. Meanwhile, 22K, 21K and 18K opened at Dh232.0, Dh224.75 and Dh192.5 per gram, respectively.
Spot gold was up 0.45 per cent at $2,072.15 per ounce as of 9.45 am UAE time, helped by the prospect of interest rate cuts in 2024 from the US Federal Reserve.
The precious metal declined as the dollar and Treasury yields rose in the third quarter of 2023 but reversed course in the fourth quarter when the greenback and yields turned sharply lower.
Richard Snow, strategist at dailyFX, said that gold revealed its allure as a safe-haven asset during the banking turmoil in March as well as the early days of the Israel-Hamas war, seeing the commodity eventually obliterate the previous all-time high.
“Expectations heading into the first quarter of 2024 is for US growth to moderate and for inflation to record further progress, putting pressure on the Fed to cut elevated interest rates. Overall, the fundamental landscape favours bullish potential or at the very least, appears supportive of precious metals,” he said.
Rania Gule, market analyst at XS.com, anticipates gold prices to remain above $2,000 in the short term.
Kelvin Wong, a senior market analyst for Asia Pacific at Oanda, said the short-term bullish trend in gold still remains intact above key support level of $2,017 per ounce.