With the mounting tensions over the U.S economy, despite the Treasury Secretary trying to allay investor fears, people seem to be choosing to invest in the traditionally safe and risk-free gold instrument. The market has been roiled for most of the month over concerns about a slowing global economy, the escalating trade dispute with China and another interest rate increase by the Federal Reserve.
Gold rose by a strong one per cent to overturn a six-month peak on Tuesday.
In the UAE, you will now have to shell out Dh153.75 for 24K gold and Dh144.50 for 22K gold. Given that this is higher by more than Dh5 per gram than prices just a couple of weeks ago, it is safe to say that buying is not a great option at the moment, while selling can give you good returns.
Markets across asset classes have come under pressure as the U.S. government shutdown that began just after midnight on Saturday intensified growth concerns. Investors have flocked to safe-haven assets such as gold and government debt at the expense of crude oil and stocks.
A gauge of stocks worldwide hurtled toward an eighth straight decline on Monday as investors ignored the U.S.
U.S. Treasury Secretary Steven Mnuchin spoke on Sunday with the heads of the six biggest U.S. banks to confirm they have enough cash to lend following the biggest weekly drop of the benchmark S&P 500 index since the Great Depression.
Mnuchin's call caused confusion, instead of soothing financial markets as intended, analysts said.