Dubai: UAE consumers looking to buy new jewellery can enjoy a momentary price relief ahead of the Eid Al Fitr holidays. After spiking in the beginning of the week, gold prices eased on Tuesday amid a stronger US dollar.
The bullion eased to 1,283.38 an ounce as of 9:31 am, after hitting $1,287.32 an ounce, the highest price achieved since over a week ago, according to Reuters.
The decline triggered a dip in local prices across the shops and souks in UAE, with the 24-karat (24K) now retailing at Dh155.25 per gram.
That means today’s buyer could buy jewellery for Dh2 per gram less than they would have paid a few days earlier. Last May 16, 24K cost pricier, at Dh157 per gram.
The price of 22K also dropped to Dh146 per gram, as well as 21K and 18K, now selling at Dh139.25 and Dh119.25 per gram, respectively.
Jewellery prices, however, may not stay in the same price point for a long time, and those who want to buy presents for Eid Al Fitr would do well to head to the shops soon.
Analysts are betting on the bullion to rally again over the next few days and 22K gold in the UAE could very well hit Dh148.45 per gram.
Davis Hall, global head of forex and precious metals for Indosuez Wealth Management, said the metal could break out of its wide consolidation band between $1,235 and $1,345.
In fact, he said, the recent gold price spike to $1,305 an ounce, which occurred after the US-Iran war comments emerged, was a sign of what may lie ahead.
"The underlying supply and demand fundamentals for gold are getting better and better as time evolves and the global economy inevitably slows and clouds over. The lose-lose backdrop
of trade war frictions and tit-for-tat tariffs will cap growth, delay the investment cycle and bring back the spectre of more quantitative easing policies for longer,” Hall told Gulf News.
“This bodes well for the yellow metal as the opportunity cost element will not weigh any further against it. This is occurring just as central banks persist with their voracious appetite for more physical bar hoarding."
“Furthermore, geopolitical tensions in the Gulf are boiling up, with oil prices on the move higher. This cocktail could well prove enough to break gold out of its wide consolidation band between 1235 - 1345.”