Dubai gold prices jump over Dh11 per gram after Wednesday dip

Dubai: Gold prices in Dubai surged on Thursday morning, reversing Wednesday’s dip as global bullion rose after the signing of an interim peace agreement between the US and Iran. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

The 24-karat variety stood at Dh519.75 per gram at 9.22am, up from Dh508.25 on Wednesday, marking a jump of Dh11.50 in a day. The 22-karat variety rose to Dh481.50 per gram from Dh470.75, gaining Dh10.75 over the same period.

The rebound brings Dubai gold prices back close to levels seen earlier this week, although they remain below the month’s highs recorded at the start of June.

Prices swing through June

Gold has seen wide moves in Dubai this month as geopolitical risk, oil prices and expectations around US interest rates kept buyers and investors on edge.

The 24-karat rate began June at Dh539.75 per gram and climbed to Dh542.50 on June 2, the highest level recorded so far this month. It eased to Dh536 on June 3 and Dh538.50 on June 4, before dropping to Dh522.50 on June 5.

Prices stayed around Dh521.75 on June 6 and June 7, before slipping to Dh521.50 on June 8 and falling to Dh514.25 on June 9. The sharpest fall came on June 10, when 24-karat gold dropped to Dh492.50, the lowest level so far this month.

The rate then recovered to Dh506.50 on June 11 and held around Dh508.50 between June 12 and June 14. It moved back above Dh520 on June 15 and June 16, before falling to Dh508.25 on June 17 and rebounding again on Thursday.

The 22-karat variety followed a similar pattern, starting the month at Dh500 per gram and rising to Dh502.25 on June 2. It fell to Dh456 on June 10, the lowest point of the month, before recovering to Dh481.50 on Thursday.

Global bullion rebounds

Internationally, bullion advanced as much as 1.7% to $4,328 an ounce, erasing the previous session’s decline.

Gold was supported by the signing of the interim peace deal between the US and Iran, even though the Federal Reserve signalled that a rate hike could still come later this year.

US and Iranian officials signed the peace agreement electronically on Wednesday evening, but uncertainty remained over whether the Strait of Hormuz had reopened and how quickly shipping through the key energy route could return to normal.

Oil prices fell after the pact, with markets expecting the agreement to ease the global energy shock that had lifted inflation and strengthened rate hike expectations. Still, traders remain cautious because it could take time for fuel prices to cool and for transit through the strait to return to pre-war levels.

Fed outlook still weighs

The Federal Reserve kept interest rates unchanged on Wednesday and said it remained focused on price stability, while removing a reference in its statement to additional rate adjustments.

Traders are now fully pricing in a tightening of monetary policy by October. Higher rates usually weigh on gold because the metal does not pay interest, making it less attractive when returns on cash and bonds rise.

- With inputs from Bloomberg.