Planning to buy gold this weekend? Dubai prices slip to 15-day low

Dubai: Gold prices in Dubai slipped to their lowest level in 15 days on Friday, offering shoppers a brief breather after a month marked by sharp swings and sudden reversals. At 8.30 am, the 24-karat rate stood at Dh581.25 a gram, down from Dh585 on Thursday, while 22-karat gold eased to Dh538.25 from Dh541.75. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

A volatile January gives way to softer prices

The latest dip comes after a turbulent run through late January and early February. Prices surged to the upper end of the range in the final week of January, with 24-karat gold peaking above Dh639 a gram on January 28 before sliding sharply the very next day. That spike proved short-lived. Rates retreated through the end of the month, steadied briefly around Dh589 at the start of February, then dropped again, touching Dh564 on February 2. Since then, prices have seesawed, rising back above Dh594 earlier this week before easing into Friday’s session at the lowest point seen since late January.

Global swings spill into local markets

International trading has been anything but calm. Silver, often more volatile than gold due to thinner liquidity, has swung wildly in recent sessions. The metal plunged almost 10% at one point before rebounding, after collapsing toward $64 an ounce. That followed a dramatic sell-off that erased all of last month’s gains, leaving silver down about 40% from its late-January peak.

Gold has fared better, reversing losses to edge higher on Friday even as broader precious metals markets remained unsettled. Analysts point to heavy speculative positioning built up through January, with investors piling into leveraged exchange-traded products and options before the rally abruptly stalled at the end of last week.

China flows and investor nerves

A sharp pullback in Chinese buying has added pressure, particularly on silver. Open interest on Shanghai Futures Exchange contracts has fallen to a one-year low, signalling traders are exiting positions ahead of the Lunar New Year break beginning February 16. Chinese prices have also flipped to a discount against global benchmarks, removing a key source of support.

Gold’s deeper liquidity has helped cushion the blow. Several banks and asset managers have reiterated bullish long-term views, arguing that the broader uptrend remains intact despite recent shocks. A Fidelity International fund manager who reduced exposure before the crash said he is ready to re-enter, while the head of commodity portfolio management at Pacific Investment Management Co. said bullion’s upward trajectory still holds.

Still, the recent turbulence has reopened debate about gold’s role as a hedge. Strategists at JPMorgan Chase & Co. have questioned its effectiveness during periods of extreme volatility, suggesting alternatives such as Bitcoin may look more attractive over the long term.

- With inputs from Bloomberg.