Photo for illustrative purposes only.


Dubai: Gold prices skyrocket as dollar weakens

Gold prices reached a five-month high on Monday as the US dollar slumped after more Chinese towns eased Covid-19 restrictions over the weekend.

Gold rose 0.52 percent to $1,808 per ounce at 9:10am UAE time.

At the market opening on Monday, 24K gold prices rose more than one dirham per gram.

24K traded at Dh219.0 per gram, up from Dh217.75, while 22K, 21K, and 18K opened at Dh168.25 per gram.

“The market still expects the Fed to slow their pace of tightening, which is providing support to gold,” said Matt Simpson, an analyst at City Index, referring to the strong jobs data.

“Also, news that China is scaling back its Covid-19 restrictions means that gold demand will increase in the region, further supporting prices,” Simpson told Reuters.

Market participants are pricing a 91 percent chance of a 50-basis point rate hike at the Fed’s meeting this month.

Lower interest rates benefit gold as it reduces the opportunity cost of holding the non-yielding asset. BKM/ Expat Media

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