Gold prices in Dubai gained Dh6.25 at the start of the week as softer oil prices eased inflation concerns, while investors awaited key US inflation data and fresh signals from the Federal Reserve on its policy outlook.
The 24K price was trading at Dh496.75 per gram at the open of the markets on Monday, up from Dh490.5 per gram over the weekend, as per data by Dubai Jewellery Group. The other variants were also trading higher, with 22K, 21K, 18K, and 14K at Dh460, Dh441.25, Dh378, and Dh295 per gram, respectively.
Globally, spot gold was trading at $4,124.11 per ounce, up 1.4 per cent. Silver was trading at $53.06 per ounce, up 2.65 per cent.
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Oil prices fell after US President Donald Trump said he was highly unlikely to order further attacks on Iran as talks to end the conflict continued, easing concerns about potential supply disruptions, according to Reuters.
Lower oil prices can ease inflationary pressures and reduce expectations that interest rates will stay higher for longer, lowering the opportunity cost of holding non-yielding bullion.
“Trump’s more conciliatory tone toward Iran is helping keep a lid on oil prices, which in turn eases some of the inflation pressure that had been weighing on the metal along with a modest pullback in the dollar,” Tim Waterer, chief market analyst at KCM Trade, said in the Reuters report.
The dollar softened, making greenback-priced bullion more affordable for buyers overseas.
Meanwhile, US job growth accelerated in October and the unemployment rate fell to 4.1 per cent reinforcing expectations that the labour market remains resilient and keeping the Fed on track for a December interest-rate increase.
Traders currently see an 81 per cent chance that the Fed will raise rates in December, up from 71 per cent prior to the payrolls data, according to CME’s FedWatch tool.
Source: Khaleej Times