Gold prices edged lower on Monday, weighed down by a stronger US dollar as investors responded to heightened geopolitical tensions following American airstrikes on key Iranian nuclear sites. Markets are now watching closely for Iran’s potential retaliation.
In Dubai, gold rates tracked global trends and declined across the board. The price of 24 carat gold fell to AED 405.76, while 22 carat dropped to AED 375.68. 21 carat gold declined to AED 358.59, and 18 carat dipped to AED 307.36.
As of 03:41 GMT, spot gold was down 0.2% at $3,362.29 per ounce, while US gold futures fell 0.2% to $3,378. Both remained above their early session lows.
According to Tim Waterer, chief market analyst at KCM Trade, “The US strikes on Iranian nuclear facilities resulted in the dollar receiving safe haven buying flows.” He added that the uptick in USD had subdued gold’s performance, even amid escalating conflict risks.
The US dollar rose 0.2% against a basket of major currencies, making gold more expensive for non-dollar investors. Meanwhile, Asian stock markets slipped, and oil briefly touched five-month highs, but no signs of panic selling emerged across global markets.
Federal Reserve’s Influence on Sentiment
Investor expectations for the Federal Reserve’s next moves also played a role. In its latest monetary policy report to Congress, the Fed noted that inflation remained somewhat elevated and the labor market solid, reinforcing views that interest rate cuts may not come soon.
On the technical front, Reuters analyst Wang Tao suggested that spot gold could retest support at $3,348, with a break possibly leading to $3,324.
Precious Metals Mixed Globally
- Other precious metals moved modestly on Monday.
- Spot silver gained 0.2% to $36.07 per ounce.
- Platinum edged up 0.1% to $1,269.17.
- Palladium rose 0.2% to $1,046.62.
Despite geopolitical tensions, gold prices fell on Friday and were on track for a weekly decline. A strong dollar and tempered expectations for US rate cuts continued to dampen sentiment.
By 4:12 GMT, spot gold was down 0.57% to $3,354.49, reflecting a 2.2% weekly drop. US gold futures fell 1.09% to $3,370.92.
In Dubai’s retail market, gold declined again:
- 24 carat gold fell AED 1.75 to AED 404.25
- 22 carat gold dropped to AED 374.25
- 21 carat slid to AED 359
- 18 carat dipped to AED 307.5
