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Gold falls further as dollar strengthens: More reason to buy for Diwali?

Compared to peak price this month, today's gold jewellery rates are cheaper by approximately Dh5 per gram

Tourists at the Dubai Gold Souk
Image Credit: Oliver Clarke/Gulf News archives
Tourists at the Dubai Gold Souk. The Indian government will soon take steps to amend a four-decade-old customs rule which even stops people from wearing simple gold ornaments for fear of being charged customs duty at airports.

Dubai: The bullion slipped further on Monday amid a strengthening US dollar and easing North Korean tensions, giving UAE consumers more reason to stock up on gold, especially as the Diwali season is just around the corner.

The price of 24K was fixed at Dh156.75 per gram as of 9.56am, falling by 50 fils from the day earlier — making the total decline to Dh5 per gram since September 5.

Other popular jewellery pieces have likewise dropped in value, with 22K retailing at Dh147.25, 21K at Dh140.50 and 18K at Dh120.25.

After breaking above the $1,300 level on August 28, spot gold suffered some setback, triggering price declines in the local jewellery trade.

The precious metal fell 0.3 per cent to $1,293.35 an ounce at 0418 GMT, not far from the $1,287.61 rate last week, when the bullion registered a 1.7 per cent decline, according to Reuters.

At the same time, the dollar index strengthened, rising by 0.1 per cent at 92.255 against a basket of currencies. The yellow metal tends to see some downside when the US dollar index increases in value.

Gold has been facing pressure, especially following Wednesday’s Federal Open Market Committee (FOMC) meeting that gave the US dollar a boost, and after weeks of speculative buying.

The majority of analysts and traders from the Wall Street had predicted in a recent survey by Kitco that the precious metal will shine again this week. But until a new price adjustment in favour of gold happens, gold jewellery fans in Dubai can expect to score some bargains.

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