Dubai gold slips below Dh400 mark as global prices hit 1-week low
Stronger dollar makes gold pricier for international investors
DUBAI: Gold prices in Dubai took a hit on Thursday, falling in line with a global dip in rates influenced by shifting trade dynamics and a strengthening US dollar.
The price of 24-carat gold in the emirate declined by Dh3.5 to Dh394.5 per gram, its lowest level in more than a week. Other categories saw similar declines, with 22-carat gold falling to Dh365.25, 21-carat gold to Dh350, and 18-carat gold dropping Dh2.75 to Dh300.25 per gram.
Globally, spot gold fell 0.72 percent to $3,274.36 at 4:07 GMT, its weakest point since May 20. US gold futures also declined 0.75 percent to $3,297.55, driven largely by the rising value of the US dollar, which climbed over 0.4 percent to 100.28. A stronger dollar tends to make gold more expensive for holders of other currencies, reducing demand.
Tariffs blocked
The declines followed a decision by a US trade court on Wednesday to halt the enforcement of tariffs imposed by former President Donald Trump. The court found that Trump had overstepped his executive authority by applying broad duties on imports from countries with trade surpluses. These tariffs, introduced on April 2 under the “Liberation Day” banner, had stirred concerns about a global economic downturn. Though many of the measures were paused just a week later, the court's ruling caused renewed ripples in global markets.
Following the legal development, the dollar index surged, while Wall Street futures and Asian equities rose. The Trump administration has since filed a notice of appeal, hinting at a prolonged legal battle.
Economic outlook
Minutes from the US Federal Reserve's May 6–7 meeting added to investor uncertainty, revealing concerns about the possibility of stagflation. With inflation and unemployment both potentially on the rise, policymakers face the difficult choice of tightening monetary policy or offering economic support.
Lower interest rates generally enhance the appeal of non-yielding assets like gold. Investors are now closely watching for the release of US GDP data and core PCE figures later today, which could offer further clues on future rate movements.
Precious metals rise
While gold declined, other metals showed resilience. Spot silver climbed 0.53 percent to $33.17 an ounce. Platinum inched up 0.20 percent to $1,077.16, and palladium posted a stronger gain of 1.14 percent, reaching $973.20 per ounce.