Gold prices rose in the United Arab Emirates on Wednesday, according to data collected by FXSTERET.
The price of gold stood at 396.61 Dirhams of the United Arab Emirates (AED) per gram, an increase compared to the 395.95 AED it cost on Tuesday.
The price of gold increased to 4,625.96 AED per Tola from 4,618.33 AED per tola from the previous day.
| Unit of measure | Gold price in AED |
|---|---|
| 1 gram | 396.61 |
| 10 grams | 3,966.08 |
| Tola | 4,625.96 |
| Troy ounce | 12,335.84 |
What moves the market today: the price of gold obtains support from a combination of factors
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The Employment and Work Rotation Survey (Jolts) published on Tuesday showed that there were 7.39 million job offers on the last business day of April. Reading exceeded 7.1 million expectations and also exceeded 7.2 million offers registered in March. The data point to the continuous resilience of the US labor market and reinforce optimism on the health of the economy.
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Despite the optimistic data, the US dollar faced some pressure due to the fall of the yields of the US Treasury bonds and the bets that the Federal Reserve (FED) will make at least two cuts of rates of 25 basic points by the end of this year. In addition, the concerns that the US budget deficit could worsen at a faster rate than expected due to the tax and expenses bill of President Donald Trump weigh on the dollar.
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The president of the Atlanta Fed, Raphael Bostic, said Tuesday that he is ‘very cautious’ regarding the possibility of cutting fees and that the best monetary policy approach now implies ‘patience’. Bostic added that there is still a way to go in inflation, since underlying prices remain a problem and that the recession is not in its forecast at this time, although it sees a possible path to a rate cut this year, depending on the economy.
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Meanwhile, the president of the Chicago Fed, Austan Goolsbee, said that a deceleration related to tariffs may not be reflected for a while in the data. All indicators point to stable and full job and we must wait to see if the tariffs have a large or small inflationary impact, Goolsbee added.
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Separately, the member of the Board of Governors of the FED, Lisa Cook, said that commercial policy is now affecting the economy and can make it difficult to reduce inflation. Cook awaits an increase in inflation and a reduction in activity due to tariffs and warned that tariffs could lead to a stagning environment. The Fed monetary policy is well positioned for a variety of scenarios, added Cook.
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Trump and Chinese President Xi Jinping are expected to maintain a call this week, probably Friday, in the midst of renewed fears of a commercial war between the two largest economies in the world. In addition, the increase in tariffs on the import of steel and aluminum from 25% to 50% will enter into force on Wednesday. This maintains the risk related to trade and offers some support for the price of safe refuge gold.
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The operators now expect the publication of the US ADP Report on employment in the private sector and the US ISM Services PMI. However, attention remains focused on monthly employment data, popularly known as the Non -Agricultural Payroll (NFP) report.
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.
