Gold prices increased on Friday, driven by a surge in safe-haven demand due to the ongoing conflict in the Middle East, while attention turned to the U.S. payroll report to assess the direction of the U.S. Federal Reserve‘s monetary policy.
In the UAE, gold rates rose by AED0.5, with 24-carat gold reaching AED322 and 22-carat gold dipping to AED298.25 from AED297.75. Additionally, 21-carat gold was priced at AED288.75, while 18-carat gold settled at AED244.
On the global front, spot gold saw a 0.3 percent increase to $2,662.50 per ounce as of 0325 GMT, following a record peak of $2,685.42 on September 26. For the week, bullion has appreciated by 0.2 percent. U.S. gold futures ticked up by 0.1 percent, reaching $2,682.10.
Currency fluctuations and their impact
The dollar slipped by 0.1 percent, retreating from a more than month-long high, which made gold priced in dollars more affordable for buyers using other currencies. Ongoing geopolitical tensions, especially in the Middle East, are bolstering gold prices, and unless these risks diminish, prices are expected to stay close to historical highs.
Gold as a safe investment
Gold is traditionally viewed as a secure investment during periods of political and financial instability, thriving in environments with low interest rates. The U.S. nonfarm payroll data will be released at 1230 GMT, with remarks from New York Fed President John Williams and Chicago Fed President Austan scheduled for later in the day.
Potential market reactions to payroll data
If the NFP report shows strong results, it could support the dollar, potentially leading to some profit-taking in gold, noted Kedia.
Future price projections
Traders currently see a 69 percent likelihood of a 25-basis-point rate cut by the Fed in November, according to the CME FedWatch Tool. BMI has projected that gold prices will fluctuate between $2,500 and $2,800 in the upcoming months.
Other precious metals
In other precious metals, spot silver rose 0.4 percent to $32.17 per ounce, marking an increase of about 1.8 percent for the week. Platinum gained 1.1 percent, reaching $1,001.79, while palladium advanced by 1.4 percent to $1,013.46.
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