Gold prices in the UAE showed signs of recovery on Tuesday morning, rebounding after a significant drop of Dh7 per gram on Monday evening. The drop was largely attributed to fears of a recession in the United States, which triggered a widespread selloff in global equities.
According to data from the Dubai Jewellery Group, the price of 24K gold rose by Dh2 per gram to Dh291.75 on Tuesday morning, compared to the previous night’s close of Dh289.75 per gram. On Monday, the price had plunged by Dh7 per gram due to worldwide equity drops stemming from recession concerns in the world’s largest economy. Other gold variants also saw changes: 22K gold traded at Dh270.0 per gram, 21K at Dh261.5 per gram, and 18K at Dh224.0 per gram. Globally, spot gold was trading at $2,410.54 per ounce, up 0.25 percent as of 9:20 am UAE time.
A note from ADBC Research highlighted that growing recession fears, exacerbated by Friday’s release of weak labor market data for July, had fueled risk-off sentiment, causing global equity markets to fall and bond markets to rally.
“The July NFP print was soft on all fronts, though the impact of Hurricane Beryl adds uncertainty. We need to closely watch upcoming labor and wider data for downside risks, especially after Fed Chair Jerome Powell emphasized the dual mandate and expressed concerns over downside risks to the labor market during last week’s FOMC meeting. An extended run of soft labor and activity prints could trigger larger rate cuts by the Fed. We already see a risk of 75 bps of cuts in 2H2024 following the July labor print, from 50 bps earlier,” the note stated.
The research also pointed out that dovish signals from Powell during the FOMC meeting have placed significant importance on the July Consumer Price Index (CPI) data, due next week, to provide further evidence of progress in disinflation.
Check out the Gold Price Article of Yesterday: Gold Prices Surge on First Trading Day of the Week
