Gold prices rose in Dubai on Monday as investors reassessed the outlook for US monetary policy and weighed the possibility of a less hawkish Federal Reserve.
Spot gold was trading at $4,392.04 per ounce around 9 am UAE time, up 0.31%. Silver also increased 0.92% to $65.44 per ounce. This comes as investors increased their exposure to precious metals amid a softer dollar and changing expectations around US interest rates.
The 24K gold price was trading at Dh529.25 per gram at the market open on Monday, up from Dh527.50. The other variants, including 22K, 21K, 18K, and 14K, were trading slightly higher at Dh490, Dh470, Dh402.75, and Dh314.25, respectively.
Dollar price slumped on Monday, making gold more attractive for investors whose currencies were not the US dollar. The dollar index fell 0.2%, adding support to bullion prices. Gold usually tends to do well when the US dollar depreciates, as it is valued in US dollars. Lower interest rate expectations may favor gold, as it does not pay any dividends.
Investors will monitor upcoming US economic data and the Federal Reserve's Jackson Hole symposium later this month. These events could influence expectations for interest rates and, in turn, gold demand.
Gold recently pulled back after approaching the $4,500-per-ounce level, with analysts largely attributing the correction to profit-taking rather than a deterioration in the metal's longer-term outlook.
The latest recovery suggests investors continue to view bullion as an important hedge against monetary and geopolitical uncertainty. However, further gains will depend heavily on the dollar, US economic data and signals from the Federal Reserve.
Also Read: Dubai Gold Price: 24K Falls to AED 529.75 Per Gram