Dubai: Gold prices now down Dh30 from April highs, but how low will it go further?

Dubai: Gold buyers worldwide have a reason to cheer as prices of the yellow metal saw a significant drop on Thursday. As a result, the Dubai gold rate too plunged, with the local rate for 22-karat gold now down by Dh30 from its recent high of Dh381.50 seen on April 21.

According to Dubai Gold & Jewellery Group data, the 24-karat opened lower at Dh378 per gram on Thursday, from Dh385.25 last night. The 22-karat, 21-karat, and 18-karat variants opened lower at Dh350, Dh336, and Dh288 per gram, respectively. (Check live rates here.)

The latest dip in prices comes after a breakthrough in Switzerland over the weekend, where the US and China agreed to ease tensions in their ongoing tariff dispute. The US cut duties on Chinese goods from 145% to 30% for a 90-day period, while China rolled back tariffs on most American imports to 10%.

This unexpected progress in trade negotiations sparked renewed confidence in global markets — and with it, a pullback from safe-haven assets like gold. Analysts say the news could further weigh on prices, which had previously surged on fears of a deepening trade conflict.

More price pressure

Adding to the downward pressure, traders are now expecting only two interest rate cuts from the US Federal Reserve this year — fewer than anticipated earlier. That shift makes higher-yielding assets more attractive relative to gold, which doesn’t pay any interest or dividends.

Even with the recent drop, gold prices remain elevated — up nearly 25% so far this year. In April, bullion hit a record high of over $3,500 an ounce, fueled by geopolitical tensions and persistent inflation concerns.

Yet despite the price cooling, gold shoppers in the UAE remain hesitant. Many are still holding out for a return to March levels, when Dubai rates briefly dipped below Dh340 per gram.

Buyers holding back?

“Buyers are holding back this week,” said one jewellery retailer. “Even with discounted or zero making charges, we’re not seeing strong demand. Many shoppers believe the rate could dip further.”

This cautious mood is nothing new. Over the past year, gold has seen multiple short-lived corrections that gave the impression of a bigger drop — only to bounce back within a day or two. That stop-start pattern has made many consumers wary of rushing in too quickly.

Still, jewellers are preparing for action. If prices continue to soften, UAE retailers are expected to roll out fresh promotions timed for the pre-summer holiday rush. “Even a drop of Dh3 to Dh5 per gram could be enough to tempt buyers back,” the retailer noted.

What does this mean for buyers?
For bargain-hunters eyeing jewellery purchases, this may be the best window to “buy the dip” — at least for now. Unless global markets face a fresh shock that revives demand for safe-haven assets, gold could remain rangebound for the near term.

All eyes are now on whether Dubai’s gold rate will dip below the Dh350 mark — or if this is as low as it goes.