Dubai gold prices rebound after sharp swings, buyers track next move

Dubai: Gold prices in Dubai moved higher on Tuesday morning, recovering slightly after recent declines, with buyers watching global cues closely amid ongoing geopolitical tension and inflation concerns. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

At 9.45 am, the price of 24K gold stood at Dh607 per gram, up from Dh602.50 a day earlier, while 22K gold rose to Dh562 from Dh557.75. The modest increase follows a period of sharp swings over the past two weeks, driven largely by global market uncertainty.

Recent trend shows volatility

Prices have seen a wide range through March, giving residents a sense of how quickly sentiment has shifted. Early in the month, gold surged to one of its highest levels this year, with 24K briefly touching Dh641 and 22K nearing Dh594, before easing in the days that followed.

A steady pullback followed that peak, with prices slipping into the low Dh620s and then further toward the Dh600 mark over the past week. Daily movements remained uneven, with brief recoveries interspersed with declines, reflecting a market that is reacting quickly to global developments.

The latest uptick suggests some stabilisation, although prices remain below their early March highs.

Global factors keep market on edge

Internationally, gold has been trading within a narrow range, with investors balancing rising inflation risks against efforts to manage disruptions in energy markets linked to the conflict in the Middle East.

Bullion held above $5,000 an ounce after a brief dip in the previous session, supported by continued demand for safe-haven assets. Oil prices have also remained elevated after renewed attacks on energy infrastructure in the Gulf and concerns over supply disruptions, particularly around the Strait of Hormuz.

Higher energy costs have added to inflation concerns, reducing expectations of near-term interest rate cuts in the US. Traders are pricing in little chance of a rate reduction at the Federal Reserve’s upcoming meeting, keeping borrowing costs elevated.

Higher rates typically weigh on gold since the metal does not offer interest, yet demand has held firm this year due to geopolitical uncertainty and concerns around slower global growth.

Demand remains resilient

Gold has gained around 16% since the start of the year, supported by steady buying interest across key markets. In China, demand has remained strong, with investors continuing to add to gold-backed exchange traded funds in recent weeks, pushing local premiums above global prices.

- With inputs from Bloomberg.