Gold prices in the UAE are stabilising following a positive upswing observed in recent weeks. 24-karat gold opened this Monday at Dh 525, reflecting a slight decline from its previous close. Whereas 22-karat gold is priced at Dh486.00, reflecting a decrease of Dh2 from the previous day. Globally, bullion experienced a decline of as much as 0.5%, falling below $4,360 an ounce, following a modest weekly gain. Traders are monitoring remarks from several State Fed policymakers, who are expected to address the necessity of an additional rate hike this year, aimed at mitigating inflation that has remained above the Fed’s 2% target for over five years.

“The inflation that the American people are feeling every day is much beyond just oil prices – it’s in all aspects of the economy,” said Minneapolis Fed President Neel Kashkari in an interview. Brent crude experienced a decline for the fourth consecutive session, yet remained above the $100 per barrel mark, as traders closely monitored diplomatic efforts aimed at resolving the US-Iran conflict. Donald Trump stated that he would “probably” be open to meeting with Iranian President Masoud Pezeshkian during the UN General Assembly in New York.

Meanwhile, the head of US Central Command indicated that flows of crude and liquefied natural gas through Hormuz over the past two weeks have reached their highest levels in six months. “Oil prices have been falling on easing Middle East supply disruptions, reinforcing the disinflationary tailwind for gold. Gold-backed ETFs have seen inflows for eight consecutive days even through recent price weakness, pointing to strong underlying investor conviction”, says Vijay Valecha. However, not everyone anticipates a positive trend for gold in the near-term. Chris Weston, Head of Research at Pepperstone, states that the traditional debasement trades have come under scrutiny.

“While flows into gold ETFs have been strong recently, supporting the gold price, one suspects they will dissipate through this week. At the crux of this is the Federal Reserve’s marked stance on fighting inflation after raising rates last week, with the market now leaning very modestly towards a follow-up hike on 28 October”. Spot gold was 0.5% lower at $4,355.83 an ounce as of 09:30 a.m. in Dubai. Silver increased by 0.2% to $66.22 per ounce. Platinum remained unchanged, whereas palladium experienced an increase. The Dollar Spot Index, a measure of the US currency, exhibited minimal fluctuation following a 1.1% increase in the previous week.