Gold prices have surged to an unprecedented high on Wednesday, driven by a weaker dollar, intensifying trade tensions, and growing apprehensions regarding global economic stability, which have collectively amplified the demand for this safe-haven bullion.
In Dubai, gold rates have shown notable advancements, with 24-carat gold increasing by AED5.25 to reach AED394.50, while 22-carat gold rose by AED5 to settle at AED365.25. Additionally, 21-carat gold experienced a rise of AED4.5, reaching AED350.00, and 18-carat gold edged up AED4.25 to attain AED300.25.
Spot gold sees remarkable increases
Spot gold climbed 1.3 percent to $3,270.12 per ounce as of 03:19 GMT, having previously touched a peak of $3,275.20 per ounce during the session. Meanwhile, U.S. gold futures saw a rise of 1.4 percent, reaching $3,286.30. “A confluence of factors such as dollar depreciation and ongoing risk aversion are working in gold’s favour,” reported Reuters, quoting Tim Waterer, chief market analyst at KCM Trade.
The dollar index declined by 0.4 percent against its counterparts, rendering gold more appealing to holders of other currencies.
Escalating trade tensions
Escalating trade tensions between the U.S. and China have further complicated matters. Nvidia announced on Tuesday that it would incur $5.5 billion in charges. This follows the U.S. government’s restriction on exports of its H20 artificial intelligence chip to China. In addition, China has instructed its airlines to halt any further deliveries of Boeing jets in retaliation to the U.S. imposing a 145 percent tariff on Chinese goods.
“Gold will continue to be strong as long as there’s uncertainty,” Brian Lan, managing director at Singapore-based dealer GoldSilver Central, was quoted by Reuters.Â
Read more: Dubai gold prices up AED0.5, global rates firm amid U.S. tariff uncertainty
Gold’s performance amid economic uncertainty
Traditionally regarded as a safe-haven investment during periods of geopolitical and economic uncertainty, gold has reached several record highs this year, boasting an increase of over 24 percent thus far in 2025. “We believe risk-off purchases for gold are yet to pick up,” analysts at ANZ remarked, subsequently raising the bank’s year-end gold price forecast to $3,600 per ounce, with a six-month forecast of $3,500.
Market anticipation
Investors are now keenly awaiting U.S. retail sales data, which is set to be released later in the day, as it may provide insights into the economy and the Federal Reserve‘s monetary policy direction. Traders currently anticipate approximately 87 basis points of Fed rate reductions by the end of 2025.
In related markets, spot silver rose 0.1 percent to $32.32 per ounce, platinum dipped 0.3 percent to $956.64, and palladium remained steady at $971.10.
