Dubai: Gold prices in the UAE are just as higher as yesterday. After a sharp Dh9 spike on Monday, 24-karat gold is just Dh7 shy of the Dh500 mark per gram.
By Tuesday morning, 24K gold was trading at Dh493.25 per gram. The 22K variety jumped to Dh456.75.
What’s driving gold now?
Globally, gold has shot past $4,150 an ounce, setting yet another record on Tuesday. Traders are piling into gold as worries grow over U.S.-China trade tensions and the possibility of fresh U.S. interest rate cuts later this year.
The uncertainty has made investors shift their money into safer assets like gold, traditionally seen as a hedge during political or economic turmoil.
Analysts from major global banks are now racing to raise their forecasts. Bank of America expects gold to average around $4,400 an ounce by 2026, while Societe Generale sees it reaching $5,000 an ounce by the end of next year.
Why rate cuts boost gold?
It’s all about returns. When interest rates fall, holding cash or bonds becomes less rewarding. Gold, which doesn’t pay interest, suddenly looks more appealing. Investors start buying it — and prices rise.
Money markets are now pricing in a 97% chance that the U.S. Federal Reserve will cut rates by 25 basis points at its next meeting later this month. That’s one of the biggest reasons gold is surging globally.
Political drama fuels fire
Tensions between the U.S. and China are back in focus. President Trump recently threatened 100% tariffs on Chinese goods before softening his stance, saying things would “be fine.” But with both countries still negotiating trade terms, investors are bracing for more friction.
At the same time, the U.S. government shutdown — now entering its second week — has paused key economic data releases, adding another layer of uncertainty.
When politics, markets, and global confidence collide, gold often benefits — and that’s exactly what’s happening now.
Justin is a personal finance author and seasoned business journalist with over a decade of experience. He makes it his mission to break down complex financial topics and make them clear, relatable, and relevant—helping everyday readers navigate today’s economy with confidence.
Before returning to his Middle Eastern roots, where he was born and raised, Justin worked as a Business Correspondent at Reuters, reporting on equities and economic trends across both the Middle East and Asia-Pacific regions.