Dubai gold rates fall as 24K slips to Dh521.75 amid oil-fuelled rate hike bets
Precious metals face pressure from rising yields and Middle East tensions
DUBAI – Dubai gold rates opened lower on Monday, with precious metal prices easing amid renewed pressure from rising oil prices and stronger expectations of higher US interest rates.
The latest retail prices from the Dubai Jewellery Group showed declines across the key 24K, 22K and 18K categories.
Global bullion markets were also under pressure as traders assessed inflation risks, central bank policy and escalating tensions across the Middle East.
Dubai gold rates
As of Monday, the Dubai Jewellery Group's suggested retail gold jewellery prices stood at Dh521.75 per gram for 24K, Dh483.25 for 22K and Dh397 for 18K. The rates reflect the latest retail pricing in Dubai and come as international gold prices retreat after recording a third consecutive weekly decline on Friday.
Global markets
Spot gold slipped 0.3% to $4,334.31 per ounce by 0330 GMT on Monday, while US gold futures fell 0.8% to $4,375.00. The decline came as oil prices climbed more than 2%, adding to concerns that renewed energy-cost pressures could keep inflation elevated.
Markets are now assigning an 86.5% probability of a US Federal Reserve rate hike at its Tuesday-Wednesday meeting, according to the CME FedWatch Tool. That expectation has risen sharply from about 67% before the latest inflation figures.
US consumer prices accelerated in August, while a key measure of underlying inflation recorded its largest monthly increase in four months. Higher interest rates can weigh on gold because bullion does not generate interest, making it relatively less attractive when yields rise.
The Bank of Japan is also widely expected to raise rates on Friday, adding another layer of pressure to precious metals as major central banks reassess monetary policy against persistent inflation and resilient economic activity.
Oil and Iran
The oil rally has been closely tied to fresh security concerns in the Middle East. Houthi strikes on Saudi Arabia and Iranian attacks on ships in the Gulf have compounded supply concerns, while the closure of a key Saudi oil pipeline has added to market worries.
The latest developments come as diplomatic efforts involving Iran and other Gulf states face setbacks, with a planned meeting postponed. The combination of supply disruption fears, higher energy prices and geopolitical uncertainty is keeping markets focused on developments around the Gulf and the Strait of Hormuz.
For gold, the competing forces of geopolitical uncertainty and higher interest-rate expectations are shaping trading sentiment. Bullion can attract demand as a safe-haven asset during periods of heightened uncertainty, but rising yields can limit that support.
Silver retreats
Other precious metals also moved unevenly. Spot silver fell 0.7% to $64.02 per ounce, extending pressure across the precious metals market as investors weighed the prospect of tighter monetary conditions.
Platinum was broadly steady at $1,796.90 per ounce, while palladium was little changed at $1,298.80. The movements leave silver particularly sensitive to shifts in interest-rate expectations, industrial demand prospects and broader sentiment across commodities.