The dollar fell 0.1% from its one-month high, making dollar-denominated gold more affordable for foreign buyers.
Gold prices rose on Friday as demand for safe-haven assets surged due to continued conflict in the Middle East, while all eyes were on US employment data to gauge the direction of the US Federal Reserve’s monetary policy.
In the UAE, gold rates rose by half a dirham, with 24 carat gold dropping to Dh322 and 22 carat gold falling from Dh297.75 to Dh298.25. Furthermore, the price of 21 carat gold was settled at Dh288.75 and 18 carat gold was settled at Dh244.
Globally, spot gold rose 0.3% to $2,662.50 an ounce as of 3:25 p.m. Japan time, following a record high of $2,685.42 on Sept. 26. This week, bullion rose 0.2%. US gold futures rose 0.1% to $2,682.10.
Currency fluctuations and their effects
The dollar fell 0.1%, retreating from its highest level in more than a month, making dollar-denominated gold more affordable for buyers using other currencies. Continued geopolitical tensions, particularly in the Middle East, are pushing up gold prices, and unless these risks abate, prices are expected to remain near historic highs.
Read more: UAE, global gold prices fall as investors focus on key US economic indicators, developments in the Middle East
Gold as a safe investment
Gold has traditionally been considered a safe investment during times of political and financial instability and thrives in low interest rate environments. U.S. non-farm employment statistics will be released at 12:30 pm Japan time, and New York Fed President Williams and Chicago Fed President Austan are scheduled to give remarks later that day.
Potential market reaction to salary data
Kedia noted that a strong result from the NFP report could support the dollar and lead to profit booking in gold.
Future price prediction
Traders currently see a 69% chance that the Fed will cut interest rates by 25 basis points in November, according to the CME FedWatch tool. BMI predicts that gold prices will fluctuate between $2,500 and $2,800 in the coming months.
Other precious metals
Among other precious metals, spot silver rose 0.4% to $32.17 an ounce, up about 1.8% for the week. Platinum rose 1.1% to $1,001.79 and palladium rose 1.4% to $1,013.46.
For more market news, click here.