Dubai gold rises after two-day drop amid easing war tensions

Dubai: Gold prices in Dubai moved higher on Monday morning, reversing part of the recent slide and reflecting a shift in global sentiment after signs of easing geopolitical tension. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

At 8:42 am, 24K gold was priced at Dh573.50 per gram, up from Dh569.75 on Sunday. The 22K variant rose to Dh531 from Dh527.75, bringing prices back closer to levels seen earlier in the month.

The move follows a broader rebound in international markets, where bullion gained after two sessions of losses. The shift came as diplomatic signals between the US and Iran raised hopes of a negotiated outcome, easing some of the inflation concerns that had been driving recent volatility.

April sees sharp swings

Price action through April shows a market that has struggled to find direction. Gold opened the month near Dh573 per gram before sliding steadily to around Dh561 by April 6, marking one of the sharper early-month declines.

Momentum then reversed quickly. Prices climbed to a peak of around Dh577 by April 9, supported by heightened geopolitical tension and strong safe-haven demand. That rally proved short-lived, with gold pulling back again toward the Dh569 range over the weekend before Monday’s recovery.

Global cues driving local prices

Internationally, bullion rose close to $4,770 an ounce, recovering ground lost over the previous two sessions. The move came even as the US tightened its stance in the Strait of Hormuz, while at the same time signalling openness to negotiations.

President Donald Trump said Iranian officials had approached his administration with the intent “to work a deal.” Iranian President Masoud Pezeshkian also indicated that Tehran remained open to continuing talks within international legal frameworks.

Oil prices dropped below $100 a barrel, easing pressure on inflation expectations. Equity markets moved higher and the dollar weakened slightly, creating a supportive backdrop for gold, which is priced in the US currency.

Lower energy prices have reduced some of the inflation-driven demand that had supported bullion earlier in the conflict. That shift has also influenced expectations around interest rates, with markets still factoring in a limited chance of rate cuts by the US Federal Reserve this year.

What it means for buyers

Despite the latest uptick, gold remains under pressure compared to peak levels seen during the early stages of the conflict. Prices are still roughly 10% lower than where they stood at the height of market stress, when investors rushed into safe-haven assets.

Recent trading suggests that buyers are stepping in during dips, but conviction remains limited. The market continues to balance easing inflation fears against the risk of renewed disruption, particularly with the Strait of Hormuz still under strain.

- With inputs from Bloomberg.