If you are considering purchasing gold in the UAE, it is important to observe that prices have experienced a slight decline from previous peaks. In the past 30 days, gold prices have experienced a decline of 6.30 percent. Currently, 18-karat gold is priced below the Dh400 per gram threshold this Tuesday morning at Dh398.25. In the UAE, 24-karat gold is currently priced at Dh523.25, reflecting a slight decrease from the previous night’s closing value of Dh523.75. Conversely, 22-karat gold has experienced a decline of 0.25 fils. Bullion was trading around $4,340 an ounce, reversing course after experiencing its largest decline in a week the previous day.

There exists a direct correlation between the behaviour of gold prices and the decline in oil prices. The decline in oil prices has alleviated inflationary concerns, providing a favourable environment for gold, which generally thrives in a low-interest-rate scenario. Oil prices, however, have remained stable on Tuesday, after experiencing a decline of more than 9% over the previous four sessions. Concerns regarding disruptions in Middle East exports have diminished, and new diplomatic initiatives have surfaced with the goal of resolving the US-Iran conflict.

Commenting on the decoupling of gold prices, Ole Hansen noted that the demand for ETFs was indicative of this disconnect. Real yields are on the rise, as the 10-year tenor has attained its peak level in two decades, driven by persistent inflation and a resurgence in long-end government bond yields. Yet instead of triggering another wave of ETF liquidation, investor demand for gold demonstrates notable resilience.

This time, therefore, it is not just the gold price that has decoupled from real yields; ETF holdings are also showing signs of doing so. Sustained optimism regarding the metal’s long-term prospects has prompted certain investors to capitalise on price dips in recent weeks. Bullion-backed exchange-traded funds have experienced approximately 50 tonnes of inflows this month, representing a third consecutive month of increases.