Gold prices rose in the United Arab Emirates on Thursday, according to data collected by FXSTERET.
The price of gold stood at 394.21 Dirhams of the United Arab Emirates (AED) per gram, an increase compared to the 391.48 aed it cost on Wednesday.
The price of gold increased to 4,598.04 AED per Tola from 4,566.11 AED per tola from the previous day.
| Unit of measure | Gold price in AED |
|---|---|
| 1 gram | 394.21 |
| 10 grams | 3,942.14 |
| Tola | 4,598.04 |
| Troy ounce | 12,261.45 |
What moves the market today: the purchase of gold continues incessantly amid the demand for safe shelter and a weaker USD
The Rules Committee of the US House of Representatives, controlled by the Republicans, voted to advance the broad draft of tax cuts and expenses of President Donald Trump, preparing the scenario for a vote in the plenary of the Chamber. The very anticipated “a great and beautiful bill” could add between 3 and 5 billion dollars to the already heavy debt load of the country.
In addition, a crucial auction of treasure bonds at 20 years on Wednesday showed a weak lawsuit, which points to growing concerns that the Tax and Expenses bill will make the US budget deficit worsen at a faster rate than expected. This occurs after Moody’s reduced the sovereign credit rating of the US of the maximum “AAA” last Friday.
The US dollar has been in the downward trend due to the fiscal concerns of the USA. In addition, the bets that the Federal Reserve will further lower interest rates this year in the midst of evidence of a decrease inflation and a gloomy prognosis of growth continue to push the USD down, raising the price of gold, which does not give up, to a maximum of almost two weeks on Thursday.
Meanwhile, China accused the United States of abusing export control measures and violating trade agreements in Geneva after the US issued a guide warning companies that do not use the chips of the Ascend de Huawei. China’s Ministry of Commerce said Wednesday that US measures on advanced chips are “typical of unilateral harassment and protectionism.”
In the Geopolitical Front, the Israel Army continued to bombard the Gaza Strip and block the desperately necessary food aid. In addition, Trump supposedly told European leaders that Russian President Vladimir Putin is not ready to end the war with Ukraine since he believes he is winning, which gives additional support to the sure shelter merchandise.
The operators now expect the publication of preliminary PMISs to obtain a new perspective on global economic health. The US economic agenda also includes the publication of the usual initial weekly applications for unemployment and sales of existing housing, which could influence the USD. This, together with the feeling of broader risk, could boost precious metal.
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.
