UAE gold prices recorded a sharp decline on Wednesday, falling by more than Dh10 per gram and reaching their lowest levels in over a month. The drop followed continued weakness in global bullion markets amid inflation concerns, higher oil prices, and a stronger US dollar.
The latest decline provided relief for gold buyers across the UAE. As a result, many shoppers gained an opportunity to purchase jewelry at significantly lower prices compared to recent weeks.
The price of 24-carat gold fell to Dh503.50 per gram on June 10. In comparison, the same category traded at Dh514.25 per gram on June 9.
Meanwhile, 22-carat gold dropped to Dh466.25 per gram from Dh476.25 the previous day. Therefore, buyers witnessed one of the largest daily declines this month.
UAE gold prices have fallen substantially since mid-May. On May 12, 24-carat gold reached Dh567.25 per gram, while 22-carat gold stood at Dh525.25 per gram.
Consequently, 24-carat gold has declined by Dh63.75 per gram over the past month. Likewise, 22-carat gold has fallen by Dh59 per gram during the same period.
The decline offers significant savings for consumers. For example, a 20-gram purchase of 22-carat jewelry now costs around Dh1,180 less before making charges than it did in May.
Furthermore, local gold prices have moved lower almost continuously throughout June. Although prices briefly increased at the beginning of the month, they soon resumed their downward trend.
Global gold prices also came under pressure. Bullion dropped nearly 2 percent and slipped below $4,175 per ounce after recording losses in the previous session.
Despite renewed tensions in the Middle East, investors did not move strongly toward gold. Instead, concerns about inflation and rising energy prices continued influencing market sentiment.
Analysts explained that stronger-than-expected US economic data also weighed on gold prices. As a result, investors increased expectations that interest rates could remain elevated for longer.
Higher interest rates generally reduce the appeal of gold because the metal does not generate interest income. Therefore, many investors shifted attention toward other assets.
In addition, rising oil prices have increased inflation concerns. Consequently, financial markets expect central banks to remain cautious when considering future rate cuts.
Market experts are now watching key support levels for gold prices. They believe future inflation data from the United States could influence the next direction of the precious metal.
Although short-term pressure remains, analysts continue to view the long-term outlook for gold as positive. Central bank purchases, geopolitical uncertainty, and global economic risks continue supporting demand for the metal.
