Gold prices in Dubai have recently experienced a notable decline, losing Dh8 per gram this week. As of November 13, 2024, the price for 24K gold has dropped to Dh315.50 per gram from Dh316.25, while 22K gold is now priced at Dh292.25 per gram. This downturn coincides with global gold trading at $2,605.56 per ounce, reflecting a decrease of 0.21%. Analysts attribute this decline to anticipated higher interest rates, which are expected to diminish gold's appeal as an investment option. The likelihood of a Federal Reserve rate cut in March has plummeted to just 11%, down from 60%, indicating a shift in market sentiment towards tighter monetary policy. Additionally, rising Treasury yields have reached 4.33%, the highest since July, further complicating the outlook for gold prices.
In contrast, earlier in October 2024, gold prices in Dubai had surged to record highs, with 24K gold reaching Dh333 per gram. This spike was driven by strong demand and geopolitical tensions, with analysts predicting that prices could approach $3,000 per ounce in early 2025. However, the recent economic shifts have led to a reevaluation of these forecasts. Ole Hansen from Saxo Bank had noted that gold's previous rise persisted despite a stronger U.S. dollar and increasing yields, highlighting the complex dynamics at play in the market.
The fluctuations in gold prices are also influenced by uncertainty in China's economy, which may enhance gold's appeal as a safe haven asset. Potential geopolitical shifts could renew interest in gold, as investors seek stability amid global economic challenges. As the market continues to navigate these changes, the outlook for gold remains closely tied to economic developments and investor sentiment, reflecting a complex interplay of factors affecting prices in both local and global markets.