Dubai: Gold prices on Thursday failed to keep the momentum gathered over recent days, as the US dollar strengthened and prospects of interest rate adjustment by the US Federal Reserve increased.
The precious metal had been quite upbeat over the last few days, with peak prices jumping from $1,279.74 an ounce on Monday to $1,289.54 on Wednesday.
As of 10.15am, however, the bullion managed to hit a high of only $1,275.59, slightly down by 1.08 per cent from the previous peak.
Gold jewellery prices in the UAE also dropped, with 24K gold alone losing Dh1.25 in value per gram since the day earlier.
The price of 22K dropped by a dirham to Dh145.25, while 21K and 18K fell to Dh138.50 and Dh118.75, respectively.
Often considered as a great store of wealth, gold has a huge following in the UAE and many residents flock to the jewellery stores when prices are low.
Argonaut Securities analyst Helen Lau said that the metal’s range bound movement is a “combination of Fed rate hike [expectations] and equity market volatility.”
“There are increasing risks in the market now. Views around these two countering forces could keep gold flat in the short-term,” she was quoted by Reuters as saying.
The dollar index also went up 0.1 per cent against other currencies.
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