Dubai gold prices jump above Dh500 per gram ahead of Navratri, Diwali

Gold prices rose above Dh500 per gram on Friday morning, supported by a weaker US dollar and easing Treasury yields, as shoppers prepare for the upcoming Navratri and Diwali festivals.

The 24K gold price gained more than Dh6 to Dh504 per gram at the market open on Friday, up from Dh497.75 at the close of trading on Thursday.

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According to Dubai Jewellery Group data, 22K, 21K and 18K gold prices were trading higher at Dh466.75, Dh447.50 and Dh383.50 per gram, respectively.

Meanwhile, 14K gold was still trading below Dh300 per gram at Dh299.25 on Friday morning.

Spot gold rose 1.44 per cent to $4,191 per ounce.

The price increase comes as the UAE enters one of the busiest periods of the year for gold jewellery purchases, with Navratri, Dhanteras and Diwali traditionally associated with auspicious gold buying, gifting and family celebrations.

As reported by Khaleej Times earlier, some expatriate and non-resident Indian (NRI) families brought forward their festive jewellery purchases when Dubai gold prices slipped below Dh500 per gram. Jewellers said lower prices encouraged shoppers to act early, while the festive season remained an important driver of demand.

Tawhid Abdulla, chairman of the Dubai Jewellery Group, previously told Khaleej Times that the period from Navratri through Dhanteras and Diwali is among the most important times of the year for gold jewellery in the UAE, particularly for retailers serving the South Asian community.

The Dubai Jewellery Group is also scheduled to run a Diwali campaign across participating jewellery retailers from October 24 to November 12, featuring promotional offers and 1kg gold raffles.

Ole Hansen, head of commodity strategy at Saxo Bank, said gold continued to attract buyers despite facing some of its strongest macroeconomic headwinds in years.

“Over the past month, a sharp rebound in the dollar, surging government bond yields and a corresponding rise in real yields have increased the opportunity cost of holding the non-yielding metal. Yet, while short-term traders have responded by reducing exposure, longer-term investors continue to accumulate gold, seemingly looking beyond immediate macroeconomic pressures towards the potential fiscal consequences of persistently high borrowing costs,” he said.

The contrasting behaviour, Hansen added, has created an increasingly visible battle between macro- and technically focused traders selling into weakness and strategic investors using lower prices to increase exposure.

“The latter appears particularly concerned about rising government debt, deteriorating fiscal positions and the risk that higher borrowing costs will eventually undermine economic stability and confidence in sovereign debt,” Hansen added.

Dubai gold prices drop further ahead of Indian festivals Navratri, DiwaliDubai gold prices fall below Dh500 as dollar strengthens Dubai gold below Dh500: Shoppers prepone jewellery buying ahead of Navratri, Diwali