Dubai Gold Prices Dip as Middle East Tensions Shake Markets
24K and 22K gold ease after a brief rebound, with global bullion pressured by conflict and oil-price concerns.
Gold prices in Dubai fell on Thursday morning after rising a day earlier, giving buyers a slight relief in rates.
24K gold was priced at Dh486.25 per gram at 9.25am, down by Dh3.50 from Dh489.75 on Wednesday. 22K gold also dropped by Dh3.25 to Dh450.25, compared with Dh453.50.
This latest dip means 24K gold is now Dh16.75 below its July high, while 22K gold is Dh15.75 lower than its peak this month.
Gold remains below July high
Gold started July at Dh489.75 per gram for 24K and moved above Dh500 by July 3. It then touched a monthly high of Dh503 on July 4 and July 5.
22K gold followed the same pattern, rising from Dh453.50 at the start of the month to a July high of Dh466.
Prices later eased, with 24K gold falling to Dh483.50 on July 13 and 22K gold dropping to Dh447.75. Both types recovered in the next two days before giving up some gains on Thursday.
Compared with the start of July, 24K gold is now Dh3.50 cheaper per gram, while 22K gold is down Dh3.25.
For buyers, 10 grams of 24K gold would now cost Dh35 less than on Wednesday and Dh167.50 less than at the monthly peak, before making charges and taxes.
Middle East tensions impact bullion
International gold prices also moved lower after the United States completed its latest strikes on Iran. This has raised concerns about the conflict and its possible impact on energy prices and inflation.
Bullion fell by as much as 0.9% to near $4,025 an ounce after US President Donald Trump pledged to continue the strikes until Tehran stopped attacking vessels in the Strait of Hormuz and agreed to reopen the waterway.
The interim peace agreement signed last month has largely broken down, while oil prices rose for a fourth straight day on Thursday.
Higher oil prices may keep inflation high and affect the US Federal Reserve’s interest-rate decisions, which can put pressure on gold since the metal does not offer regular income.
Gold stays near $4,000
Gold has stayed close to $4,000 an ounce in recent weeks after falling 14% in the second quarter, its weakest quarterly performance since 2013.
The drop followed expectations that the Federal Reserve could raise interest rates to control inflation caused by the war and higher energy costs.
US producer price inflation data released on Wednesday was softer than expected, showing that underlying price pressures had eased before the latest escalation in the Middle East.
The reading may give the Federal Reserve more time to review the economy, although a continued rise in energy prices could make the outlook more difficult.
Federal Reserve Chairman Kevin Warsh has said interest rates remain one of the tools available to control inflation, while noting that policymakers can stay patient before making their next move.
AI contributed to the creation of this article.