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Gold's rebound halted as Fed minutes loom

Local jewellery rates slightly down by .50 fils compared to Tuesday's prices

Image Credit: Zarina Fernandes/Gulf News archive
Gold prices in Dubai have eased after hitting their highest level this month.

Dubai: Gold’s rebound came to a pause on Wednesday as the markets await the minutes of the US Federal Reserve meeting, which could set a new tone for bullion prices.

At the same time, gold jewellery rates in Dubai inched down by about .50 fils per gram. As of 9.30am, 24-karat gold was trading at Dh156 per gram, down by .31 per cent from a day earlier, while 22K moved lower to Dh146.50. The price of 21K and 18K also eased to Dh139.75 and Dh119.75, respectively.

Details of the discussions during the recent Fed meeting in September are due out on Wednesday and ahead of the release, spot gold was little changed at $1,282.80 per ounce.

Jewellery rates in Dubai soared to their highest level this month as the bullion gained support from the softening of the US dollar and some geopolitical tensions, which include the threat of another North Korean missile test and the Catalan referendum.  

“Gold rose initially following on from its overnight rally, but this faded to leave it almost unchanged as early Asia buying petered out,” Reuters quoted Jeffrey Halley, senior market analyst at OANDA, as saying on Wednesday

“With North Korea relatively quiet and the Catalans choosing not to escalate the constitutional quagmire in Spain, gold gave up some of its safe-haven premium as we approached midday.”

If the Fed minutes indicate that interest rates will have to be adjusted, investors could pull away from gold and cause prices to fall.

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