Gold prices in Dubai lost Dh3.75 in one day as investors out their bets on a rate hike next month.
The 24K variant was trading at Dh479.25 per gram at the open of the markets on Thursday, down from Dh483 per gram.
The other variants, 22K, 21K, 18K, and 14K, edged lower at Dh443.75, Dh425.5, Dh364.75, and Dh284.5 per gram, respectively.
Globally, gold slipped 0.48 per cent to below the $4,000-mark, trading at $3,973.72 per ounce as of 9:14am UAE time. Silver fell 1.21 per cent to $51.37 per ounce.
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The precious metal bounced back briefly on Wednesday, which financial analyst Vijay Valecha said was a technical retracement. He explained that investors are currently awaiting the next “catalyst.”
Investors have currently put their bets on a 90.8 per cent rate increase in the US Federal Reserves’ December 9 meeting, according to CME FedWatch data.
“Fed officials Michelle Bowman and Anna Paulson stressed that bringing down inflation remains the top priority and that more rate increases lie ahead,” Valecha, who is chief investment officer of Century Financial, explained.
“Higher rates raise the opportunity cost of holding non-yielding bullion, reducing its appeal, and the near-term macro setup for gold does not look positive,” he added.
On the technical side, Valecha said gold is capped below resistance at $4,068, with stronger resistance at $4,144 and then $4,193, where earlier rebounds failed. Support lies at $4,030, then $3,957, and a break below would expose $3,913 and $3,877. The bias stays bearish while price trades below $4,144.
Source: Khaleej Times