Gold prices in Dubai slipped a little on Monday after gains as traders looked at new worries about inflation and the future of US interest rates. The 24‑karat gold price opened at Dh525 per gram, a little below the close. The 22‑karat price was Dh48,6, down Dh2 from Sunday.
Around the world,ld gold fell up to 0.5 percent to below $4,360 per ounce after a small weekly rise. Spot gold was $4,355.83 per ounce at 9:30 a.m. Dubai time.
Fed outlook is key
Investors are watching closely the comments from US Federal Reserve policymakers for clues about the bank’s plan to tackle inflation.
Market attention has moved to the chance of interest‑rate hikes after inflation stayed above the Fed’s 2 percent goal for a long time.
Higher interest rates can hurt gold because gold does not earn interest, which may make interest‑earning assets appealing to investors.
At the same time, gold still gets support from investment demand.
Vijay Valecha, investment officer at Century Financial, said gold‑backed exchange‑traded funds had drawn money for eight straight days even though gold prices were weak, showing that investors still care.
Oil prices stay high.
Oil markets also shape the inflation picture.
Brent crude fell for the day in a row but stayed above $100 a barrel while traders watched diplomatic moves in the US‑Iran conflict and how it might affect energy supplies.
Valecha said that less disruption to Middle East supplies could strengthen a trend toward inflation that may affect gold prices.
The outlook is still uncertain.
Chris Weston, head of research at Pepperstone,ne said that the recent strength in gold‑backed ETF money could weaken as markets pay attention to the Federal Reserve’s stance on inflation.
Other precious metals were mixed on Monday. Silver rose 0.2 percent to $66.22 an ounce while platinum barely changed and palladium went higher.
The Bloomberg Dollar Spot Index stayed broadly steady after going up 1.1 percent last week.
For UAE gold shoppers, Monday’s opening rates show some consolidation after the rally,y while global markets keep weighing the competing forces of inflation, interest rates, oil prices and investment demand.