UAE: Gold prices steady after plunging on Wednesday

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The UAE gold prices were steady on Thursday morning after plunging by Dh2.75 per gram to a two-week low on Wednesday evening.

The Dubai Jewellery Group data showed 24K trading at Dh247.5 on Thursday morning as compared to Dh250 at the opening of the markets on Wednesday. Meanwhile, 22K, 21K and 18K variants of the yellow metal were trading at Dh229.25, Dh221.75 and Dh190.0 per gram, respectively.

Spot gold was down slightly at $2,042.99 per ounce on Thursday morning. The yellow metal fell to a near two-week low on Wednesday as the dollar strengthened.

Rania Gule, market analyst at XS.com, said gold turned bearish amid a cautious market and is facing selling pressure as investors reassess their expectations for a Federal Reserve interest rate cut in March.

She added that the lack of crucial information about interest rate cuts from Federal Reserve officials in the FOMC meeting minutes weakened gold's attractiveness in the short term, supporting the strength of the US dollar and Treasury yields.

“I think that lower chances of a short-term interest rate cut may weaken gold's attractiveness in the near term, particularly after Federal Reserve Chair Jerome Powell stated in the recent monetary policy statement that interest rate cuts will be a topic for future discussion, causing market mood swings and high volatility.”

Vijay Valecha, chief investment officer, Century Financial, said from a technical viewpoint, the recent setback near the all-time high closing, approximately in the $2,077-2,078 range, and the subsequent decline should alert cautiousness among bullish traders.