UAE: Gold prices to rise this week, with potential to go even higher later

Gold
Gold
Image Credit: Gulf News Archive

Dubai: Gold prices this week are headed higher, which marks an end to comparatively lower price levels seen last month, and multiple analysts opine that there is the potential for costs to rise even higher in the weeks to come.

This makes it an ideal time to either make the most of low prices now to stock up or brace for higher prices in the weeks to come, if you are an investor looking to sell and pocket a handsome profit.

What is gold priced at currently?

The yellow metal is currently trading largely unchanged on the day near $1,927 (Dh7,077) per ounce, having peaked at a record of $2,075 in August (Dh7,621) and pulled back to $1,848 (Dh6,787) on September 24.

So if you’ve missed out on an opportunity to buy when prices dropped in late September, as prices are still fairly low and set to rise even further in the days and months ahead, matter experts evaluate the present being an ideal time to buy.

Gold has gained 27 per cent so far this year as major central bankers have called for renewed government spending to recover major economies from the coronavirus pandemic-induced recession.

Why gold prices are rising?

Supporting the case for rising prices is the resurgence of the coronavirus cases, especially across Europe. Uncertainty around US elections and the possibility of additional stimulus drove investors to bullion, which is considered as a hedge against inflation and currency debasement.

What this simply means, in terms of a market investment perspective, is the price of gold rises when there is higher risk of uncertainty surrounding any globally significant event. So, as these pandemic-related risks are still high, and expected to only increase in the weeks to come, the natural effect on gold prices is that it will keep rising further.

However, also keep in mind that if virus concerns spike even further and lead to a bigger aversion to risk among market participants, safe-haven currencies like the US dollar can likely find bids, experts add, which can complicate matters for currently rising gold prices, and can trigger a slight decline or prices to briefly stay stagnant.

Similar trend seen for silver

A similar trend was observed when it comes to the price of silver, as prices have been recently edging upward as well, which analysts consider a positive sign and therefore evaluate that prices will probably see a follow-through in the days to come.

Silver bar rate in UAE retail market is Dh2,870.96 per kilogram and Dh1,435.48 per 500 grams. Silver coin price is Dh2.87 per gram and Dh28.71 per 10 grams, and 50 gram silver coin rate in the UAE is Dh143.55.

In a month’s time, the retail silver rate in the UAE is expected to be around Dh91.38 per ounce. Silver price in the next seven days is seen around Dh87.86 per ounce, and the forecast of how much silver would be priced at over the next 90 days is at around Dh87.51 per ounce.

Dh2,216.24 was the lowest per kilogram silver rate in the UAE in the last 3 months, a price that was seen on July 12, 2020, while the highest per kilogram silver price in the UAE was recorded on September 1, where the price went as high as Dh3,410.56.

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