Gold prices took a hit on Friday as markets braced for the release of the U.S. Personal Consumption Expenditures (PCE) index, a crucial measure of inflation that could influence the Federal Reserve’s next moves on interest rates. The stronger U.S. dollar added further pressure, making gold less attractive for global investors.
Gold Prices in the UAE
The impact of the global trend was felt in the UAE, where gold prices dropped across different categories:
• 24K gold fell by AED3.5, now priced at AED345 per gram.
• 22K gold declined by AED3.25, settling at AED321 per gram.
• 21K gold dropped AED3, bringing it to AED307.75 per gram.
• 18K gold dipped by AED2.75, reaching AED263.75 per gram.
International Gold Market
Globally, gold faced downward pressure:
• Spot gold lost 0.4%, trading at $2,864.94 per ounce.
• Gold Futures for April slipped 0.6%, landing at $2,877.80 per ounce.
Despite the short-term dip, gold remains on track for a 2% monthly gain, fueled by economic uncertainty and trade tensions.
Market Drivers: Inflation & Trade Tensions
Investors are on edge as they await the U.S. PCE inflation data, which could influence expectations for future interest rate changes. If inflation remains high, the Federal Reserve may maintain higher interest rates, which could dampen gold’s appeal as an investment.
Adding to market jitters, former U.S. President Donald Trump reiterated plans to enforce a 25% tariff on imports from Mexico and Canada, along with a 10% tariff on Chinese goods. These trade policies could fuel economic uncertainty, potentially increasing gold’s demand as a safe-haven asset.
Other Precious Metals Under Pressure
Gold wasn’t the only metal feeling the heat:
• Platinum Futures dipped 0.4% to $948.55 per ounce.
• Silver Futures fell 1%, trading at $31.495 per ounce.
What’s Next for Gold?
The direction of gold prices in the coming weeks will largely depend on the U.S. inflation report and Federal Reserve policy signals. If inflation data suggests prolonged higher interest rates, gold may face further short-term pressure. However, ongoing trade tensions and economic uncertainty could keep gold in demand as a reliable investment option.
