24K gold trading at AED 497.25 per gram at the market open. The latest rate follows a sharp decline seen on Monday evening. Data from the Dubai Jewellery Group showed further declines across other gold categories. The 22K rate stood at AED 460.5 per gram, while 21K gold traded at AED 441.5.
The 18K and 14K variants were priced at AED 378.5 and AED 295.25 per gram, respectively. Globally, gold prices also moved lower. Spot gold fell 0.2% to USD 4,127.6 per ounce as of 9:08 am UAE time. Silver declined 1.27% to USD 60.56 per ounce during the same period.
Ole Hansen, head of commodity strategy at Saxo Bank, linked the weakness in gold and silver to several market factors. He pointed to rising bond yields, a stronger US dollar and technical selling after gold broke a key support level.
“The pressure from rates is becoming increasingly difficult to ignore,” Hansen said. “Traditionally, such a sharp increase in the opportunity cost of holding a non-yielding asset would be a major headwind for gold,” he added.
He noted that US 10-year real yields have climbed to an 18-year high near 2.85%. Short-term interest-rate markets are also pricing another three 25-basis-point Fed hikes by next April.
Hansen said investors will also watch exchange-traded fund flows. He noted that some investors appear less sensitive to interest rates and more focused on the financial impact of high borrowing costs. He also said higher yields could create longer-term demand for gold as investors seek protection against financial and sovereign risks. However, he warned that funding stress could weigh on gold in the short term.
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