Dubai gold hits 90-day low after Dh102.50 fall from April peak
24K has lost Dh102.50 from its April peak, while 22K is down Dh94.75
Dubai: Gold prices in Dubai fell to their lowest level in 90 days on Friday, handing jewellery buyers the cheapest rates seen since April after another difficult week for the precious metal.
The 24-karat variety stood at Dh479.75 per gram at 9.35 am, down Dh1.75 from Dh481.50 on Thursday. The widely purchased 22-karat variety also fell Dh1.75 to Dh444.25 per gram from Dh446.
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Friday’s rates take both varieties to their lowest levels in the price data stretching back to April 19.
The decline means the underlying gold value of a 10-gram purchase is now Dh1,025 lower for 24K and Dh947.50 lower for 22K compared with the April peak, before making charges and other retailer costs are added.
More than Dh100 wiped off 24K
Dubai’s 24K rate has dropped Dh102.50 per gram, or around 17.6 per cent, from Dh582.25 on April 19.
The 22K rate has fallen Dh94.75 from Dh539 over the same period, also representing a decline of about 17.6%.
Prices remained elevated through late April and much of May, with 24K regularly trading above Dh540 and reaching Dh570.75 on May 11. The retreat gathered pace in June, although rates briefly climbed above Dh520 during the first half of the month.
Gold moved below Dh500 later in June and has remained close to that threshold through July.
July gains have disappeared
The latest fall has also taken 24K down Dh23.25 from its July high of Dh503, recorded on July 4 and July 5.
The 22K variety has lost Dh21.75 from its July high of Dh466 over the same dates.
Friday’s price is Dh14 lower for 24K compared with July 10, while 22K is Dh13 cheaper. Most of that decline came during the past three sessions, with 24K falling from Dh489.75 on Wednesday to Dh479.75 on Friday.
Buyers who had been waiting for rates to move below the levels seen in late June now have a wider price advantage. The 24K rate is Dh6 lower than on June 29, while 22K is Dh5.50 cheaper.
Gold heads for steep weekly loss
Global gold was heading towards its biggest weekly loss since early June, despite edging higher to nearly $3,980 an ounce on Friday.
Bullion was down 3.4% for the week after renewed hostilities in the Middle East increased concerns that higher energy costs could keep inflation elevated and push the US Federal Reserve towards another interest-rate increase.
The US launched another round of attacks on Iran on Thursday following strikes the previous night that hit an oil tanker near the country’s main export terminal.
Oil prices held on to a substantial weekly gain, adding to inflation concerns as the conflict entered its fifth month.
Several Federal Reserve officials have expressed concern about persistent inflation and warned that interest rates may need to rise. Higher rates tend to weigh on gold because the metal does not pay interest, making yield-bearing assets more attractive by comparison.
A stronger dollar and rising bond yields also added pressure. Gold is priced in the US currency, which makes it more expensive for buyers using other currencies when the dollar gains.
Bullion has traded within a relatively narrow range around $4,000 in recent weeks after losing 14% during the second quarter, its weakest quarterly performance since 2013.
- With inputs from Bloomberg.
