Dubai: Gold prices hit all-time high; will prices rise further?

02/09/2025 03:38 AST

Gold prices hit an all-time high in Dubai as the 24K rose above Dh420 per gram.

According to the Dubai Jewellery Group, 24K reached Dh422.25 per gram late on Monday, surpassing the previous all-time high of Dh420.

Among the other variants of the precious metal, 22K was trading at Dh391.25 per gram, 21K at Dh375.0, and 18K at Dh321.25.

Spot gold was trading at $3,495.79 per ounce, up 1.39 per cent on Tuesday morning.

The rising precious metal prices are putting gold shoppers and traders in quandary whether to buy, sell or hold their investments. Many UAE residents - especially Asians - buy gold coins, bars and jewellery due to cultural, economic, and practical reasons.

In addition, economically, gold is viewed as a stable and secure investment. People in the UAE often see gold as a way to preserve wealth across generations. Additionally, gold jewellery serves both as an adornment and as a form of portable wealth that can be easily liquidated in times of need.

The rally in gold prices over the past few years is mainly driven by central banks' buying, a drop in interest rates, geopolitical tensions around the world, and the tariff row, among others.

Analysts expect precious metal prices to continue to rise in Dubai and globally if geopolitical tensions, tariff rows, and central banks' buying continue.

Samer Hasn, senior market analyst at xs.com, said the immediate catalyst lies in growing conviction that the US Federal Reserve will move toward a September rate cut, amid rising pressure from Donald Trump, while broader equity markets lose momentum as enthusiasm for artificial intelligence begins to be alarming.

"Together, these dynamics have strengthened gold's appeal as investors hedge against both monetary and equity-market uncertainties," he said, adding that labour market data will dominate the agenda this week.

"A weaker jobs report could entrench expectations of a rate cut, pressuring the dollar, which is already trading at a five-week low, while a stronger print could temper market conviction and weigh on bullion," added Hasn.

According to the World Gold Council, gold has historically shown intensified sensitivity to monetary policy expectations around the annual Jackson Hole Economic Symposium, and this year is proving no different.