Gold prices in Dubai shot up tracking the bullish trend of international prices as the tensions in the Middle East escalated. In the latest development, there have been explosions heard in Iran and the US reportedly confirmed many international media outlooks that it was Israel's retaliation. However, it is still not confirmed by both Israel and Iran. Nonetheless, that was enough for gold prices to shine near their all-time high levels.
Gold Prices In Dubai:
In Indian rupees, the emirate city of UAE witnessed a surge of Rs 11.37 to Rs 1,136.76 across 22-carat and 24-carat.
10-gram of 24 carats is up by Rs 113.68 to Rs 65,591.34 on April 19 compared to Rs 65,477.66 on the previous day. While 100 grams surged by Rs 1,136.76 to Rs 6,55,913.40, as against the previous day's print of Rs 6,54,776.64. Also, 1-gram and 8-gram gold is up by Rs 11.37 and Rs 90.94 in a single day.
Similarly, 10-gram of 22-carat was up by Rs 113.68 to Rs 60,760.09; 100-gram surged by Rs 1,136.77 to Rs 6,07,600.89; 8-gram gained by Rs 90.94 to Rs 48,608.07; and 1-gram of gold is up by Rs 11.37 to Rs 6,076.01.
However, in local currencies, gold prices recorded a mixed trend. While 22-carat and 24-carat prices are up by 0.50 to 50 dirhams, the prices of 18-carat gold have dipped by 2.55 to 255 dirhams.
Under 18-carat gold, 10 grams of yellow metal is available at 2,187 dirhams, down by 25.50 dirhams from the previous day. Meanwhile, 100-gram gold plunged by 255 dirhams to 21,870 dirhams, 8-gram was down by 20.40 dirhams to 1,749.60 dirhams, and 1-gram gold is lower by 2.55 dirhams to 218.70 dirhams.
What Is Driving Gold Prices?
As per Yes Securities, there is a strong demand for gold due to the following reasons:
- The latest driver for gold prices has been the demand side story - mainly driven by the central bank buying for its reserve assets. This also signifies the waning confidence in holding USD as reserve assets.
- Rising demand for gold and silver for industrial use - specifically for circuitry manufacturing in the electronics sector.
- Rising retail demand from China. This has enabled the neutralizing of money flowing out of gold ETFs. China retail demand is strong due to the uncertain China economic environment - leading to residents hedging risks and parking funds into safe-haven gold.
Furthermore, the brokerage added, "The overarching reason why gold demand has been high is the fears of uncertainty globally. The uncertainty relates to both macros and geopolitical tensions, such as the Russia-Ukraine crisis, the Red Sea crisis etc. Global international relationships have seen greater degrees of confrontation, polarization and a move away from global cooperation. The macro outlook remains uncertain even as the world has shown significant growth resilience. Risks to election outcomes (64 counties representing a combined population of 49% go to elections in 2024) remain that along with macro uncertainties can shape policymaking.:
But what will happen if the Middle East tensions ease?
Jateen Trivedi, VP Research Analyst said, "Ongoing geopolitical tensions in the Middle East are expected to keep gold volatile. In the event of an escalation in the situation, the dollar may find support, dampening gold prices. Conversely, if tensions ease between Iran and Israel, gold could experience profit booking, potentially driving prices down towards 69500."
Disclaimer: The recommendations made above are by market analysts and are not advised by either the author or Greynium Information Technologies. The author, the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.
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