Gold prices rose to a new record high for the second consecutive day on Tuesday as 24K inched closer to Dh500 per gram at the opening of the markets.
The Dubai Jewellery Group data showed 24K trading at Dh479.25 per gram on Tuesday morning, up from Dh475.25 per gram at the close of the markets on Monday, a gain of Dh4 per gram.
Similarly, 22K moved closer to Dh450 per gram, surging Dh4.75 per gram to Dh443.75. 21K and 18K opened higher at Dh425.5 and Dh364.5 per gram, respectively.
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Spot gold crossed $4,3975 in early morning to trade at $3,976 per ounce at 9am UAE time, as investors rushed for safe-haven assets due to concern around the US government shutdown and expectation of further interest rate cut.
Ahmad Assiri, research strategist at Pepperstone, said global markets met with a fresh dose of political risk that stole attention from economic data, much of which remains absent due to the ongoing US government shutdown.
“In France, the sudden resignation of the Prime Minister, only a short time after forming his government, reignited concerns over political stability and narrowed the horizon for policy continuity. In Japan, Sanae Takaichi’s victory as leader of the Liberal Democratic Party fuelled expectations of more expansionary fiscal policy. And the market reaction was instant; the Nikkei index surged over 4 per cent to fresh record highs above the 48,000 level, supported by a simultaneous weakening in the yen,” said Assiri.
“Gold extended its historic advance, with traders now eyeing the key $4,000 level. These elevated levels highlight gold’s growing strategic role as a structural component within diversified portfolios, with both institutional and retail investors increasing their exposure, unlike previous phases when central banks led the accumulation. The current bid for gold mirrors rising unease in markets; equity valuations have reached multiples near 23 times earnings, bringing the word ‘bubble’ into discussion, perhaps on every research desk. Should such concerns grow large, gold stands as the most effective refuge,” he said.
