Investors Await US Inflation Data Impact on Precious Metal Rates
Gold prices in the UAE experienced a slight decline of Dh1 per gram on Wednesday morning, mirroring global trends influenced by a stronger US dollar. On Tuesday, the yellow metal saw a dip in value worldwide, contributing to the decrease in local prices.
In Dubai, the price of 24K gold was Dh280.5 per gram at the start of Wednesday, down from Dh281.5 per gram at Tuesday’s close. Other gold variants also saw a decrease, with 22K opening at Dh259.75, 21K at Dh251.5, and 18K at Dh215.5 per gram. Internationally, gold was priced at $2,317.03 per ounce, marking a 0.14 percent decline at 9:17 am UAE time.
George Khoury, the global head of education and research at CFI, commented on the situation: “Gold prices have stagnated as investors await crucial US inflation data expected later this week, which could influence the Federal Reserve’s approach to interest rate adjustments.” The anticipated data includes the US core Personal Consumption Expenditures (PCE) index, consumer spending and income metrics, Q1 GDP growth, and the goods trade balance.
On Monday, San Francisco Fed Bank President Mary Daly stressed the importance of not reducing rates until there is clear evidence that inflation is consistently moving towards the 2 percent target.
Khoury added, “More speeches are expected throughout the week from figures such as Fed Governors Lisa Cook and Michelle Bowman, which could offer additional clues on the future monetary policy and impact market sentiment.”
He also noted, “Upcoming elections in France and the United Kingdom are stirring investors’ concerns, with polls indicating a possible shift towards the far right in France. Additionally, escalating tensions in the Middle East and the ongoing conflict between Russia and Ukraine could heighten market uncertainty, potentially bolstering gold prices as investors seek stability.”