Gold prices in Dubai went down on Monday. This happened because people are more worried about interest rates than about tensions. With problems around the Strait of Hormuz gold prices did not go up much. This shows that global markets are in a phase.
- 24K gold went down to Dh577.50 per gram from Dh582.25 the day
- 22K gold went down to Dh534.75 from Dh539.
The drop happened because of what’s happening in international markets. Spot gold prices went below $4,800. Are now around $4,775.
Experts say the main reason for the drop is what people think will happen with US interest rates. If rates stay high it costs more to hold gold because it does not earn interest. So investors are choosing assets that earn money instead.
It is interesting that gold prices went down with global tensions. The Strait of Hormuz is very important, for oil shipments. Problems there usually make investors buy gold.. Now it seems like markets are used to these problems and do not see them as a surprise.
Experts say this is a time of “recalibration”. Investors are thinking about risks and returns. The strong US dollar and high bond yields are also hurting gold prices.
People are now waiting for US data, especially retail sales numbers. If the data is strong it might mean interest rates will stay high and gold prices might go down. If the data is weak it might help gold prices.
With the current drop experts think gold will do okay in the long run. There are still tensions and a chance of economic slowdown. These things might make people want to buy gold. For now gold is stuck between uncertainty and high interest rates.
