Gold Image Credit: Gulf News Archive

Dubai: Gold prices have broken through to a new record - $2,045 an ounce and easily clearing the $2,035 set in early August of 2020.

Gold prices have been under intense pressure through these 13 days, with the Russia-Ukraine conflict impacting on all commodities.

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But the speed with which gold shot through $2,000 an ounce level yesterday and then closed in on the $2,050 mark by this evening (March 8) astounded even the most ardent gold followers.

"This momentum could last all the way to $2,100 - and if anything, it reinforces gold's status as the ultimate safe haven, " said Shamlal Ahamed, Director of International Operations at Malabar Gold & Diamonds.

The Dubai Gold Rate is currently at Dh229.25 a gram for 22K, and should soon reflect the push towards $2,050.

Currently, some commodity tracking sites are showing good prices at an eye watering $2,053.

Gold joins other commodities from metals to food that have seen new all-time peaks or multi-year highs. Oil has gone through this and could even be up for $200 a barrel if more restrictions are brought to bear on Russian oil exports.

Nickel, wheat, steel and just about any other commodity is facing the same upward pressure, emanating from events playing out in Ukraine.

Price drop

Shoppers in the UAE had been taking full advantage of the current prices to sell some of their holdings and pocket a neat cash profit. (Some of the smaller gold and jewellery retailers also sold some of their inventory and thus free up some cash flow for themselves, according to market sources.)

So, when will shoppers in the UAE make a return to buying gold? The Indian festival of 'Akshaya Trithiya' falls early May - "If gold prices were to settle by then - or even better, drop - that would be the right time to see some buying," said a gold retailer.

"Now, it's best to have watch the action unfold. To have this happen to gold twice in two years - of setting new record highs - is the best advertisement for shoppers to keep buying."

When the time - and the price - is right...