Gold prices rose in the United Arab Emirates on Monday, according to data collected by FXSTERET.
The price of gold stood at 379.70 Dirhams of the United Arab Emirates (AED) per gram, an increase compared to the 378.20 AED it cost on Friday.
The price of gold increased to 4,428.77 AED per Tola from 4,411.19 AED per Friday tola.
| Unit of measure | Gold price in AED |
|---|---|
| 1 gram | 379.70 |
| 10 grams | 3,797.02 |
| Tola | 4,428.77 |
| Troy ounce | 11,810.07 |
What moves the market today: the price of gold attracts safe refuge flows in the middle of a softer dollar; It lacks bullish conviction
Moody’s reduced the sovereign credit classification of America on a step, to “AA1” on Friday, citing concerns about the growing indebtedness of the nation. This occurs while the Chamber Panel approved the Tax Cutting bill of US President Donald Trump in the early hours of Monday, which could add billions to the US debt.
Meanwhile, US Treasury secretary, Scott Besent, told CNN News on Sunday that President Donald Trump will impose tariffs at the rate he threatened the commercial partners last month who does not negotiate in “good faith” in the agreements. This further reinforces the price of gold as a safe refuge at the beginning of a new week.
The Consumer Price Index (ICC) and the US Production Price Index (PPI) published last week pointed to signs of relief in inflationary pressures. In addition, the disappointing US retail sales data increased the probability that the US economy experiences several slow growth quarters.
In addition, Michigan University surveys showed Friday that the consumer’s feeling index deteriorated even more in May and fell from a final reading of 52.2 in April to 50.8, the lowest level since June 2022. This reaffirmed the bets for at least two cuts of 25 basic points by the Federal Reserve this year.
The US dollar continues with its struggle to attract significant buyers amid the moderate expectations of the Fed, and turns out to be another factor that benefits the raw material. However, commercial optimism has relieved concerns about a recession in the US and limits the bullish potential for the Xau/USD torque.
In the Geopolitical Front, the office of the Israeli Prime Minister Benjamin Netanyahu said Sunday that the army will allow limited amounts of food in Gaza. However, Fuentes said there have been no progress in a new round of indirect conversations between Israel and the Palestinian militant group Hamas.
Meanwhile, Ukraine said on Sunday that Russia attacked with a record number of drones. This maintains the geopolitical risks at stake and should act as a tail wind for the precious metal in the absence of any relevant economic publication of the US and before the speeches of influential members of the FOMC later today.
FXSTERET calculates gold prices in the United Arab Emirates adapting international prices (USD/Aed) to the local currency and the units of measure. Prices are updated daily according to market rates taken at the time of publication. Prices are only reference and local rates could diverge slightly.
FAQS GOLD
Gold has played a fundamental role in the history of mankind, since it has been widely used as a deposit of value and a half of exchange. At present, apart from its brightness and use for jewelry, precious metal is considered an active refuge, which means that it is considered a good investment in turbulent times. Gold is also considered a coverage against inflation and depreciation of currencies, since it does not depend on any specific issuer or government.
Central banks are the greatest gold holders. In their objective of supporting their currencies in turbulent times, central banks tend to diversify their reserves and buy gold to improve the perception of strength of the economy and currency. High gold reserves can be a source of trust for the solvency of a country. Central banks added 1,136 tons of gold worth 70,000 million to their reservations in 2022, according to data from the World Gold Council. It is the largest annual purchase since there are records. The central banks of emerging economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has a reverse correlation with the US dollar and US Treasury bonds, which are the main reserve and shelter assets. When the dollar depreciates, the price of gold tends to rise, which allows investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rebound in the stock market tends to weaken the price of gold, while mass sales in higher risk markets tend to favor precious metal.
The price of gold can move due to a wide range of factors. Geopolitical instability or fear of a deep recession can cause the price of gold to rise rapidly due to its condition of active refuge. As an asset without yield, the price of gold tends to rise when interest rates lower, while the money increases to the yellow metal. Even so, most movements depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (Xau/USD). A strong dollar tends to keep the price of gold controlled, while a weakest dollar probably thrusts gold prices.
(An automation tool was used to create this publication.)
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
