Gold prices in the UAE continued to decline on Tuesday morning, shedding Dh2 per gram at the market opening, following a Dh4.5 per gram drop on Monday. By 9am UAE time, the 24K variant of gold had slipped to Dh317.0 per gram, down from Dh319.0 per gram at Monday's market close. The other variants, 22K, 21K, and 18K, also opened lower at Dh293.5, Dh284.0, and Dh243.5 per gram, respectively.
Spot gold was trading at $2,617.87 per ounce, up by 0.26 per cent at 9.05am local time. Fadi Al Kurdi, founder and CEO of FFA Kings, attributed the decline in gold prices to a robust sentiment surrounding the US dollar. 'Anticipation of expansionary policies from Donald Trump has kept the dollar near a four-month peak, weighing on the precious metal. With the greenback strengthening, gold could remain under pressure,' he said.
This week, market participants are focusing on US inflation data and upcoming Federal Reserve speeches, particularly those from Fed Chair Powell. These events are crucial for gauging the direction of interest rates, especially given expectations surrounding Trump's second term. Changes in the interest rate outlook could influence gold demand, resulting in near-term volatility.
'There is also growing speculation that the Federal Reserve may adopt a more cautious approach to rate cuts in response to Trump’s proposed policies, which include increased tariffs, tax cuts, and deregulation. In the medium to long term, however, gold could remain well-positioned as a safe-haven asset, given the potential uncertainties arising from trade tensions and geopolitical tensions,' said Al Kurdi.
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