Gold prices experienced an upward trend in Dubai during the initial trading hours of the week, following a period of decline in the previous week's trading sessions. In the UAE, the 24K gold variant increased by half a dirham per gram, reaching Dh291.25 per gram at 9am, a slight rise from last week's closing price of Dh290.75 per gram. The price of gold had dropped by nearly Dh8 per gram in Dubai on Friday. Similarly, the prices of 22K, 21K, and 18K gold also started the day higher, at Dh269.75, Dh261.0, and Dh223.75 per gram respectively.
On a global scale, spot gold decreased by 0.19 percent, trading at $2,406.8 per ounce at 9.10am. Chris Weston, the head of research at Pepperstone, commented that the potential resignation of US President Joe Biden as the Democratic Party nominee could be perceived as a negative factor for gold. Despite this, the weaker dollar is currently supporting markets across Asia. Weston noted that Kamala Harris has not yet secured the full nomination, and since Barack Obama has not expressed a preference, the contest remains open. However, he believes that the prediction markets are correct in viewing Harris as the leading candidate for the position. Democrat donors have already pledged over $50 million, suggesting a revitalized outlook for the party.
Weston emphasized that there are still enough uncertainties to prevent a significant drop in gold prices, and economic trends will play a crucial role in shaping interest rate cut expectations and, consequently, the gold price. He added that while Harris's potential elevation of the Democrat's prospects into November might reduce the need to hold gold as a hedge against a hawkish foreign policy and extensive deficit spending under Trump/Vance, there are still medium-term factors that could support a bullish outlook for gold.
