Dubai Gold Prices Gain Dh6 Per Gram As Fed Raises Interest Rates

(MENAFN- Khaleej Times) Gold prices in Dubai were trading higher on Thursday morning after the US Federal Reserve raised interest rates for the first time in three years.

The 24K variant was trading at Dh518 per gram at the market open on Thursday, up from Dh512 per gram at the close of the markets on Wednesday.

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The other variants, 22K, 21K, 18K, and 14K, were similarly trading higher at Dh479.50, Dh459.75, Dh394.25, and Dh307.50 per gram, respectively.

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Globally, spot gold was trading at $4,297.61 per ounce, down 1.13 per cent, as of 9.10am UAE time. It follows its sharp decline from August's high of $4,692.

Silver was down 1.12 per cent, trading at $63.72.

The UAE Central Bank raised its base rate by 25 basis points to 3.9 per cent, following the US Fed's decision late on Wednesday.

Financial analyst and CIO of Century Financial, Vijay Valecha, said that gold investors had pulled back sharply into the meeting on binary rate-decision risk.

“The structural backdrop stays supportive over the medium term: ETF holdings have rebounded sharply from July's lows back toward earlier-year levels, and central banks remain in steady accumulation mode per the latest World Gold Council data, both of which should help cap deeper downside once the current rate-hike overhang clears,” he said.

On the technical side, Valecha said that gold remains capped within a descending channel from the late-August high, with resistance at $4,352 (channel top) and a firmer barrier at $4,509.

“Support lies at $4,273, followed by $4,200. A sell-on-rise approach toward channel resistance is favoured while the structure holds, though a decisive break above $4,509 would challenge the bearish setup, and a no-hike surprise would likely trigger that break immediately,” he noted.

Silver, on the other hand, is also rebounding off support near $62.00 within its own descending trendline from the early-September high.“Resistance sits at $65.49, then the trendline itself near $66.00–67.00. A similar sell-on-rise bias is favoured while price stays capped below these levels, with a break above $66.00 needed to shift the outlook, a scenario that would also become far more likely on a surprise Fed hold,” the analyst explained.

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