Gold prices spike in Dubai: Why UAE shoppers should wait until Thursday
Dubai: The Dubai Gold Rate has risen by Dh3.5 a gram to start the week, with a gram of 22K selling at Dh365 (and Dh394 for 24K), in what will be a huge disappointment for shoppers who were expecting prices to soften.
Today's rate is still lower than last Monday's (April 28) Dh371, but all through last week the trend was for the local gold rate to drop. On May 1, it was at Dh359.
'Shoppers would have been expecting gold to slip to around Dh350-Dh355 levels, so to see prices around Dh365 will be a huge blow to sales this week if this trend continues,' said a jeweller. 'Even tourist demand will come in lower. The only hope is that some of the planning wedding purchases materialize.'
'Wait until Thursday'
This week, gold buyers/investors will be better off waiting to see the outcome of the next US Federal Reserve Meeting, which will decide on whether retain interest rates at current levels or cut them. (President Trump has been vocal about the need for lower interest rates, which added to the market turbulence seen last month.)
Hoping for gold demand spike in June
The UAE gold trade is also hopeful that closer to June, there will be some pick up in gold buying activity, especially with a sizable section of the resident base planning their holiday trips after schools close. (At those times, buying gold and then selling them at a profit in their home countries has been a traditional pattern.)
In fact, all trends suggest there should be some weakening in gold prices short-term. All that frenzied market movements over Trump tariffs have subsided to a good extent. The US dollar's still on the lower side but still at levels seen last week.
Currently, in the global metals market, gold is trading at $3,266 an ounce, up nearly $30 so far.
US Fed meeting
Gold analysts say that today's rise has everything to do with the US Federal Reserve meeting scheduled for Wednesday. In recent times, there has always been a gold price spike ahead of such meetings.
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