UAE: Gold prices inch higher in early trade after falling from last week's record high

Gold prices in the UAE inched higher in early trade on Monday after falling from witnessed last week.

The 24K variant of the yellow metal was trading at Dh331.75 per gram on Monday morning compared to last week’s close of Dh331.5 per gram. Among the other variants, 22K, 21K, and 18K were trading at Dh307.25, Dh297.5, and Dh255.0 per gram, respectively.

Gold hit an all-time high on Thursday as 24K reached Dh337.25 per gram while 22K stood at Dh312.25 per gram.

Spot gold was trading at $2.741.47 per ounce, down by 0.26 per cent.

The yellow metal rates have been mainly driven by the geopolitical tension in the Middle East, uncertainty around the US election and interest rate cuts by the US Federal Reserve.

Samer Hasn, senior market analyst at xs.com, said that geopolitical factors may preserve gold’s ability to continue its upward trend with increasing reports about the possibility of Iran launching an attack on Israel. “This may lead to a new round of attacks and counter-attacks that may eventually affect economic facilities and supply chains and exacerbate uncertainty about the global economy,” he explained.

Hasn noted that weak equity market performance would have provided further support for gold as risk appetite waned, given mixed quarterly results from major corporates and some negative outlooks for the future. However, the massive inflows into bond funds could be a drag on non-yielding gold’s gains.

“On the other hand, political uncertainty in the US as the presidential election approaches is likely to boost the appeal of the yellow metal as the polls are getting closer and closer with no clear advantage for either candidate,” he added.