Gold prices were down on Tuesday as investors awaited the release of U.S. jobs data and Federal Reserve chair Jerome Powell’s comments for further insight into the central bank’s interest rate outlook.
In the UAE, gold prices saw an AED0.25 decline with 24-carat gold inching down to AED281.75 per gram, while 22-carat gold declined to AED261. Twenty-one-carat gold was at AED252.50 while 18-carat gold reached AED216.50.
Globally, spot gold saw a 0.22 percent decline to $2,327.13 per ounce, as of 5:07 GMT. Meanwhile, U.S. gold futures lost 0.10 percent to $2,336.55.
Interest rate outlook
Gold prices declined as traders look for signs regarding the U.S. interest rate outlook in Powell’s speech later today. Traders also await the release of ADP employment, ISM services PMI data, minutes of the Fed’s last policy meeting due on Wednesday, and the nonfarm payrolls report due Friday for more insights into possible monetary policy changes.
While gold is traditionally an inflation hedge, higher interest rates increase the opportunity cost of holding the non-yielding asset.
Analysts cited several factors that could impact the performance of gold prices, including slower retail demand in China, weaker central bank demand, and a delay in interest rate normalization by the Fed.
Read: UAE’s Arada lists $400 million sukuk on Nasdaq Dubai
Other precious metals
Despite the decline in gold prices, the metals market saw mixed movement. Spot silver was down 0.51 percent to $29.29 while platinum declined 0.22 percent to $975.60. However, palladium surged 0.90 percent to $980.19.
