Gold prices stayed close to a two-week high on Tuesday, supported by a softer U.S. dollar and ongoing concerns about the country’s fiscal outlook. Investors awaited upcoming U.S. economic data for clues on the direction of interest rates.
In Dubai, gold prices saw a slight decline. The price of 24-carat gold dropped by AED9.25 to AED394.5 per gram, while 22-carat gold fell to AED361.5. Similarly, 21-carat gold decreased to AED345.25, and 18-carat gold slid to AED296.00.
Spot gold remained relatively steady at $3,339.99 an ounce as of 02:28 GMT, staying above the $3,330 mark. Markets in the U.S. and London were closed Monday for a holiday. U.S. gold futures fell 0.8% to $3,339.80 but currently hover above $3,361.
Kelvin Wong, senior market analyst for Asia Pacific at OANDA, told Reuters, “Gold prices are consolidating as the market pauses, awaiting the next catalyst. However, concerns over the widening U.S. budget deficit continue to support gold prices and also contribute to dollar weakness.”
The dollar index softened by 0.3%, lingering near a one-month low against other major currencies. This weakness made dollar-priced gold more attractive to investors holding other currencies.
Last week, the U.S. House of Representatives passed a version of President Donald Trump’s tax-cut bill, which the Congressional Budget Office projects will add roughly $3.8 trillion to the federal debt—currently $36.2 trillion—over the next decade.
Meanwhile, President Trump backed away from his threat to impose 50% tariffs on imports from the European Union next month, maintaining the July 9 deadline to allow for trade talks between Washington and the 27-nation bloc.
This week, investors are closely watching speeches from Federal Reserve policymakers and Friday’s U.S. core Personal Consumption Expenditures price index report for signals on interest rates. Futures traders expect the Fed to likely resume rate cuts in September.
In other precious metals, spot silver edged up 0.1% to $33.38 per ounce, platinum held steady at $1,084.28, while palladium slipped 0.3% to $984.25.
