Dubai gold prices declined on August 28, as investors turned cautious ahead of Federal Reserve Chair Kevin Warsh’s closely watched speech at the Jackson Hole economic symposium. The precious metal recently climbed to a more than three-month high, but traders are now waiting for clearer signals on the US central bank’s interest-rate outlook.
The 24-carat gold rate in Dubai fell to AED 552.50 per gram on August 28. The 22-carat rate stood at AED 511.75 per gram, while 21-carat gold was priced at AED 490.50. The 18-carat and 14-carat rates declined to AED 420.50 and AED 328 per gram, respectively.
The decline came after gold reached a three-month high earlier in the week. Investors have since adopted a wait-and-watch approach as they assess the Federal Reserve’s policy direction.
According to the latest numbers, the Personal Consumption Expenditures price index in the United States, the Fed's preferred inflation indicator, stood at 3.7% year-over-year in July. High rates usually put pressure on gold since it has no interest. A hawkish Fed can additionally help the US dollar and Treasuries, putting gold at a disadvantage.
Spot gold fell about 0.5% to USD 4,576.30 per ounce in early August 28 trading, according to Reuters, and US gold futures also declined. The move followed a strong rally earlier in the week, when gold climbed above USD 4,600 amid concerns over US fiscal conditions and a weaker dollar.
Looking ahead, analysts continue to see underlying support for gold from central-bank demand, exchange-traded fund inflows and concerns surrounding US fiscal policy.
Also Read: Dubai Gold Price: 24K Hits AED 556.50, Silver Gains 1.41%