Dubai gold prices pause near highs after early January surge

Dubai: Gold prices in Dubai opened steady on Wednesday morning, trading just below recent peaks as global markets catch their breath ahead of key US economic numbers. At 9.10 am local time, 24-karat gold stood at Dh537.75 per gram and 22-karat at Dh498, keeping both varieties within easy reach of last week's record levels. (Check latest UAE gold prices here, alongside prices in Saudi Arabia, Oman, Qatar, Bahrain, Kuwait, and India.)

Local prices have stayed elevated through the first week of trading in 2026. The 24-karat rate started January at Dh520.25, dipped to Dh519.25 on January 2, held steady through January 3 and 4 at Dh522, then surged to Dh536.25 on January 5 alongside Dh496.50 for 22-karat. The following day saw 24-karat peak at Dh538.50 with 22-karat at Dh498.50 before settling back slightly to current levels. Buyers see a market locked in a tight range near all-time highs, with daily swings tied to overseas moves.

Spot gold steadied near $4,490 an ounce after three days of gains that lifted prices more than 4%. Traders shifted past geopolitical headlines toward US data due this week, including Friday's December jobs report. A weaker manufacturing gauge released Tuesday strengthened bets that the Federal Reserve will cut rates further after three reductions last year. Fed Governor Stephen Miran called for more than a full percentage point of easing in 2026, arguing that current policy restrains growth.

Geopolitical risks linger in the background. The US capture of Venezuela's president revived energy supply worries, given the country's vast oil reserves. China imposed export controls on Japan with military applications, escalating tensions between Asia's largest economies. The White House said President Trump won't rule out military action to acquire Greenland. Those developments keep safe-haven demand alive even as attention turns to economic indicators.

Gold delivered its best annual performance since 1979 in 2025, smashing repeated record highs on central bank buying and ETF inflows. Silver outpaced even that with nearly 150% gains, powered by supply shortages and retail frenzy, particularly in China. The white metal climbed for a fourth straight day Wednesday, gaining as much as 1.8% while building toward its $84.01 peak from late December.

"Gold prices have risen for a third consecutive session and moved close to the $4,500/oz level during the Asian session, before retreating modestly," said Linh Tran, Market Analyst at XS.com. "This price action indicates that the broader uptrend remains intact, supported by macroeconomic and geopolitical fundamentals." She notes US data points to slowing growth without deep weakness, with manufacturing contracting but services expanding.

Central banks added around 45 tonnes in November alone, lifting year-to-date purchases near 300 tonnes by month-end. Tran highlights the strategic nature of that buying. "These figures suggest that gold accumulation is not opportunistic, but rather reflects a long-term strategy to diversify foreign-exchange reserves and reduce reliance on fiat currencies, amid an increasingly fragmented global financial order."

Traders await a packed US calendar covering growth, jobs and inflation. Stronger numbers could delay rate-cut hopes, lift the dollar and pressure bullion prices. Weaker data would reinforce easing expectations and send gold back toward recent peaks around $4,550. The World Gold Council points to mixed global signals last week, with solid US jobs and housing offset by Eurozone contraction and China's uneven recovery.

Venezuela developments add another layer. US military action there underlines ongoing geopolitical influence on gold prices, though medium-term effects remain unclear amid efforts to reinforce the petro-dollar system. Oil benchmarks and the dollar will compete with US data as key price drivers this week.

The World Gold Council notes that gold has pulled back from late-December record highs, suggesting consolidation ahead. Yet the core uptrend persists, with positioning in Brent and WTI futures remaining short. Social media buzz highlights Venezuela production restarts remain years away despite ample reserves.

- With inputs from Bloomberg.