Dubai: Retail gold rates in Dubai inched lower on Tuesday as investors are trying to secure gains from the recent price rally.
The precious metal dropped to Dh139 per gram for 24 carat, Dh132 for 22K and Dh126.50 for 21K. The price for 18K also declined to Dh109.50.
Gold had climbed significantly on October 9, following reports that the central bank won’t adjust the rates yet.
As of Tuesday, gold registered a decline of nearly one per cent, retreating from a three-month high on profit taking after a two-day rally, according to a Reuters report.
By 0643 GMT, spot gold was down 0.6 per cent to $1,156.30 an ounce, “after earlier dropping as much as 0.9 per cent.” In the previous session, the bullion rose to its highest level in three months at $1,169.
According to a recent analysis, gold is headed for further price declines towards the end of the year, but it will not go lower than the $1,100 level.
Dutch bank ABN Amro last week revised its year-end gold forecast from $1,000 to $1,100 per ounce, citing that the US dollar is likely to be weaker than earlier expected, while the United States Federal Reserve is seen to adjust the rates only in 2016. By the end of next year, gold is expected to drop to $900, instead of $800.
“This does not mean that we have seen the low in gold prices. We still expect the Fed to hike interest rates next year and the US dollar to rally in an environment of positive investor sentiment,” wrote Georgette Boele, coordinator, foreign exchange and precious metals strategy at the bank.
The bank has downgraded the US dollar forecasts for the rest of the year, with the EUR/USD expected to trade within the range 1.10-1.15.
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-- With reports from Reuters
