Dubai gold prices jump to all-time high on rate cut bets and global tensions

Dubai: Gold prices in Dubai surged to a new all-time high on Monday morning, tracking the global rally that has pushed the precious metal to its strongest levels in more than four decades. At 7:45 am in Dubai, the 24-karat variety stood at Dh526.50 a gram, while 22-karat gold was priced at Dh487.50. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

The rally comes as geopolitical tensions intensify and expectations grow for further US Federal Reserve rate cuts. Internationally, gold climbed more than 1%, surpassing its previous record of $4,381 an ounce set in October.

Traders now expect the Fed to lower rates twice in 2026 following recent US data that did little to clarify the economic outlook. The anticipation of looser monetary policy has increased demand for gold and silver, which do not offer interest but benefit from declining yields.

Recent weeks have seen a series of geopolitical flashpoints that have bolstered gold’s appeal. The US has intensified an oil blockade against Venezuela, stepping up pressure on President Nicolás Maduro’s government, while Ukraine mounted its first attack on a vessel from Russia’s “shadow fleet” in the Mediterranean.

Both gold and silver are heading for their strongest yearly performance since 1979. Gold has gained about two-thirds so far in 2025, supported by robust central bank purchases and sustained inflows into gold-backed exchange-traded funds (ETFs).

Gold prices in Dubai have steadily risen through December. On December 1, 24-karat gold was priced at Dh511.75 a gram, before gradually climbing to this morning’s record of Dh526.50. The 22-karat variety moved in tandem, rising from Dh473.75 to Dh487.50 over the same period. The momentum has been consistent over the past two weeks, reflecting strong investor demand and higher international benchmarks.

After a brief pullback in October, gold has rebounded sharply. Analysts at Goldman Sachs expect prices to keep rising through 2026, with a base-case forecast of $4,900 an ounce and potential upside risks. The bank noted that ETF investors are increasingly competing with central banks for limited physical supply.

In its latest report, the World Gold Council noted, “In a turbulent year marked by heightened macroeconomic and geopolitical risks, gold’s volatility has increased alongside that of other assets, including major equity indices. That said, its long-term behaviour has remained broadly consistent, and comparable to that of other growth assets.”

The report added that periods of sharp price spikes were short-lived, underscoring gold’s resilience. “Against a backdrop where traditional diversification benefits are waning, gold continues to play a valuable role in reducing overall portfolio risk, reinforcing its importance for investors seeking stability amid uncertainty,” the Council said.