According to data from the Dubai Jewellery Group, 24K gold opened at Dh229.75 per gram on Wednesday, compared to the previous night’s closing price of Dh231.0 per gram. This represents a decrease of Dh2.25 in value over the past 24 hours.

Furthermore, other variants of gold, including 22K, 21K, and 18K, also opened lower at Dh212.75, Dh206.0, and Dh176.5 per gram, respectively, at 9 am local time.

On the global scale, spot gold remained subdued at $1,896.54 per ounce by 9.15 am UAE time, having breached the critical $1,900 threshold and reaching its lowest level since August 23 on Tuesday.

Vijay Valecha, the Chief Investment Officer at Century Financial, attributed gold’s continued decline to the rise in long-term US Treasury yields and the strengthening US dollar. He also noted that gold’s short-term technical outlook appeared uncertain.

In a separate development, China’s local gold price premium has reached unprecedented levels, reaching $121 per ounce on September 14.

This premium typically exceeds international prices due to China’s heavy reliance on gold imports, which have become scarcer due to import controls and limited domestic production.

Limited gold imports in July and August coincided with increased wholesale demand, further driving up the Shanghai-London gold price premium.

Additionally, short covering in the Shanghai-Comex futures spread could be contributing to this trend.

However, Valecha pointed out that the rising gold prices in China have discouraged demand recovery in 2023 and may continue to dampen consumer interest, potentially leading to weaker-than-expected sales during the upcoming Golden Week.

Last Updated: 27 September 2023