Gold prices in Dubai spiked sharply on Friday, hitting Dh602.50 per gram, as geopolitical tensions in the Middle East — and uncertainty over US interest rates raised global demand for safe havens. Retailers across the emirate described rising investor demand when bullion markets responded to mounting regional tension, as rising regional turmoil sparked buying behavior among bullion traders.
Global Market Trends
Gold, traditionally viewed as a hedge against political and economic uncertainty, has enjoyed renewed buying momentum in the last few sessions. Market analysts argue the rise is part of a larger global pattern. Gold prices on the global markets have gained on worries that deepening tensions in the Middle East could disrupt commerce flow and energy markets. Investors frequently turn toward precious metals at such times because they believe value-added metals offer protection from commodity shocks of volatility in the stock market or currencies.
Role of US Interest Rates
Gold's upward momentum, too, has been bolstered not only by geopolitical risks but also uncertainty over the US Federal Reserve's goal to further set interest rates in this regard. Speculations of potential rate cuts which can be held back or relaxed, by delayed tightening procedures — tend to depreciate the US dollar, making gold more attractive for foreign investors. Since gold is worth the price around the world in dollars, a softer dollar should make it more appealing.
Dubai’s Gold Market
Dubai’s gold market, the region’s most dynamic one, tracks international price fluctuations closely. “There’s been steady demand, for instance for wedding season and buying during the holidays by both investors and consumers,” the Gold Souk traders said.
Economic Concerns
The United States also raises concerns about what happens with geopolitical and economic data at the time, according to finance analysts. Inflation numbers, labor data and Federal Reserve’s take on the economy are likely to push markets in the next week or two.
Safe‑Haven Investment
As prices have been volatile in the short term, analysts continue to argue gold remains a safe‑haven. With global uncertainty clouding markets, the precious metal remains an investment choice of many for investors who prefer stability.
With 24K gold currently trading at Dh602.50 a gram, market participants could be closely monitoring whether prices will consolidate at the level it currently rests on as yet further consolidation or further gain moving ahead.
