The 24-karat variety was priced at Dh488.75 per gram at 8.39 am, reflecting a decrease of Dh7.75 from the previous figure of Dh496.50 on Sunday. The decline of approximately 1.6% resulted in the rate falling below Dh490 for the first time since early July. The popular 22-karat variety decreased by Dh7.25 to Dh452.50 per gram, down from Dh459.75 in the prior session. Monday’s decline positioned 24-karat gold at Dh14.25 beneath its July high of Dh503, whereas 22-karat gold stood Dh13.50 below its monthly peak of Dh466. Gold commenced the month at Dh489.75 for 24-karat and Dh453.50 for 22-karat, subsequently experiencing a steady ascent in the initial days.

The 24-karat rate surpassed Dh500 on July 3, peaking at Dh503 on both July 4 and July 5, while the 22-karat variety increased to Dh466. Prices subsequently declined, with 24-karat gold decreasing to Dh490 on July 8 before rebounding to Dh497.25 the next day. The recovery was short-lived, with rates fluctuating between Dh493.75 and Dh496.50 over the weekend, followed by a decline on Monday that brought both varieties below their opening levels from July 1. The decline in Dubai was part of a broader sell-off in precious metals, triggered by renewed hostilities between the US and Iran over the weekend. This escalation has led to an increase in energy prices, reigniting worries regarding inflation and interest rates.

Spot gold experienced a decline of up to 1.6%, trading close to $4,050 per ounce, following a loss of 1.4% in the preceding week. Silver experienced a decline of up to 3.1% on Monday. Confusion also surrounded the status of the Strait of Hormuz following the US’s dismissal of an Iranian assertion that the waterway would remain closed “until further notice.” US Central Command reported that American forces executed a fourth series of strikes within a week in response to an attack on a container ship. Rising energy prices have heightened worries that inflation may prove challenging to manage, thereby constraining the US Federal Reserve’s ability to lower borrowing costs.

Minutes from the Fed’s June meeting indicated that several policymakers saw merit in raising rates, though officials ultimately favoured maintaining the current levels. Elevated interest rates generally exert downward pressure on gold, as the asset does not yield interest payments. The yield on the rate-sensitive two-year US Treasury note rose to its highest level since February 2025, while the dollar appreciated, rendering precious metals more costly for purchasers utilising alternative currencies. Gold has declined by over 20% since the onset of the Iran war in late February. Profit-taking concluded a three-year rally and momentarily drove the metal beneath $4,000 an ounce for the first time since November.