Dubai: Gold prices drop as US dollar strengthens

Dubai: Gold prices drop as US dollar strengthens

Gold prices slipped in Dubai and worldwide as the US dollar strengthened on Tuesday morning. Spot gold dropped 0.44 per cent to $1,760.14 per ounce by 9.15 am UAE time, after hitting $1,770.41, its highest since September 23, on Monday. In the UAE, 24K opened at Dh213.0 per gram on Tuesday morning while 22K was trading at Dh200.25, 21K at Dh191.0 and 18K at Dh163.75 per gram. The US Federal Reserve’s conditions for raising interest rates could be met by the end-2022, Cleveland Fed Bank President Loretta Mester said on Friday, adding, she expects inflation to come back down to the central bank’s target next year. Naeem Aslam, chief market analyst at AVA Trade, said it may be a year or longer before the central bank’s employment goal is met to allow for an actual interest rate increase. “Gold is traditionally seen as an inflation hedge, although reduced central bank stimulus and interest rate hikes tend to push government bond yields up, in turn translating into a higher opportunity cost for gold that pays no interest. Demand for physical gold also picked up in top consumer China last week and there was increased activity in other Asian hubs including Singapore,”