Dubai gold crosses Dh600, shoppers rethink buying plans

Dubai: Dubai gold prices moved back above the Dh600 mark on Thursday morning, keeping the local market on edge after weeks of sharp swings that have tested buyer sentiment across jewellery stores. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

At 9.30 am, the 24-karat rate stood at Dh600.75 per gram, slightly higher than Dh600.50 recorded a day earlier. The 22-karat variety held steady at Dh556.25, unchanged from Wednesday levels.

The return to Dh600 territory signals continued volatility in the local market, with consumers navigating frequent daily shifts that have defined February trading.

Price movements this month show a highly uneven pattern, with gold oscillating between strong rallies and abrupt pullbacks. Early February began below Dh590 before prices quickly climbed above Dh610 during the second week. The surge proved short lived, with bullion sliding sharply to the mid-Dh590 range before rebounding again.

Recent sessions highlight the choppiness. Prices crossed Dh607 mid-month, slipped back toward Dh590 days later, and then climbed once more to reclaim the Dh600 threshold. Such fluctuations have left retail buyers adopting a wait-and-watch approach, particularly those planning large jewellery purchases.

Market traders say the swings reflect global uncertainty rather than local demand shifts, with international cues continuing to dictate price direction.

"Rare earths are rapidly evolving into a strategic asset class as nations strive to reduce reliance on China, which retains overwhelming dominance in mining and refining capacity. Driven by surging demand from critical industries and heightened government intervention, the market infrastructure is maturing to meet the challenge," said Tony Sage, CEO of Critical Metals. "A pivotal milestone in this evolution is the CME Group’s plan to launch rare earth futures contracts. Establishing a transparent price benchmark will enable complex financial strategies, while the creation of derivatives promises to unlock investment capital and allow stakeholders to hedge against volatility."

Globally, bullion stabilised after gaining about 2% in the previous session, with trading activity subdued in parts of Asia due to holiday closures.

Spot gold hovered near $4,970 an ounce on Thursday after bargain buying emerged following a two-day decline. The market has remained unusually volatile since an earlier sharp correction that pulled prices back from record highs above $5,595.

Recent Federal Reserve signals have added to the uncertainty. Minutes from the US central bank’s January policy meeting showed officials expressing caution about cutting interest rates quickly, a stance that could complicate expectations for lower borrowing costs.

A stronger dollar also weighed on bullion sentiment after US economic data pointed to resilient industrial output and stronger-than-expected capital goods orders.

"Simultaneously, Washington is strengthening its rare earths strategy," added Sage. "The US has formalised strategic stockpiling through Project Vault, backed by $12 billion, while the 2026 Critical Minerals Ministerial united 54 countries under a coordinated framework to diversify supply chains and address pricing power."

Market forecasts continue to point to a broadly supportive outlook for gold, with geopolitical tensions and monetary policy uncertainty shaping investor behaviour.

Banks including BNP Paribas, Deutsche Bank and Goldman Sachs expect the broader uptrend to resume, citing persistent global risks and continued diversification away from traditional financial assets.

Traders remain focused on developments in the Middle East, particularly negotiations between the US and Iran. Diplomatic progress could ease safe-haven demand, while any escalation may push prices higher again.

With global uncertainty still elevated and central bank policy direction unclear, analysts say gold is likely to remain volatile in the near term, keeping Dubai shoppers closely tracking daily price movements before making buying decisions.

- With inputs from Bloomberg.