Gold prices declined from their record high on Wednesday as the dollar slipped to its lowest this year and U.S. rate cut hopes rose as investors awaited the release of the Federal Reserve‘s latest meeting minutes for insight into the size of the cuts.
In the UAE, gold prices declined AED2 with 24-carat gold inching down to AED304.5 and 22-carat gold declining to AED282. Meanwhile, 21-carat gold reached AED273 and 18-carat gold hit AED234.
Globally, spot gold gained 0.14 percent to $2,516.85, as of 5:11 GMT, after hitting a new all-time high of $2,531.60 on Tuesday. Meanwhile, U.S. gold futures inched up 0.16 percent to $2,554.80.
Gold gains 22 percent this year
Gold prices have gained around $470 or 22 percent so far this year amid rising geopolitical tensions, uncertainty surrounding the U.S. elections, and interest rate cut bets. So far, gold is on track for its largest annual rise since 2020 with prices exceeding the $2,500 mark.
Ahead of the Fed’s July meeting minutes, traders fully priced a rate cut at the Fed’s next meeting, with a 68 percent chance of a 25 basis point cut, according to the CME FedWatch tool.
Further supporting gold prices, the dollar index declined to its lowest this year, with benchmark 10-year Treasury yields dipping, making non-yielding assets like bullion more attractive for investors.
Traders now await the Fed’s July policy meeting minutes due later today and Fed Chair Jerome Powell’s speech on the U.S. economic outlook on Friday at Jackson Hole.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, revealed that its holdings declined 0.20 percent on Tuesday from their seven-month highs.
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Other precious metals
As gold prices hit new record highs, the precious metals market remained mixed. Spot silver rose 0.23 percent to $29.49 while platinum gained 0.52 percent to $950.90. Palladium, however, lost 1.16 percent to $924.73 while copper lost 0.25 percent to $4.14.
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