Gold prices surged at the opening of the markets in the United Arab Emirates on Monday, with investors flocking to the safe-haven metal amidst escalating tensions between Iran and Israel. According to data from the Dubai Jewellery Group, the price of 24K gold soared to Dh285.5 per gram, marking a significant increase of Dh1.75 per gram compared to last week’s close of Dh283.75. Other variants also witnessed notable upticks, with 22K opening at Dh264.25, 21K at Dh256.0, and 18K at Dh219.25 per gram.
Globally, spot gold was trading at $2,356.3 per ounce, reflecting a 0.5 percent increase as investors sought refuge amidst geopolitical uncertainties. The surge in gold prices comes in the wake of Iran’s attack on Israel early Sunday, utilizing 300 drones and missiles, which heightened concerns among investors and prompted a rush towards safe-haven assets.
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Diego Colman, a contributing strategist at dailyFX, commented on the remarkable performance of gold in recent weeks, noting a rally of over 17 percent since mid-February despite adverse conditions. He highlighted the resilience of gold amidst the strength of the US dollar and hawkish expectations regarding US interest rates, attributing the metal’s strength to a breakdown in its typical negative correlation with US real yields.
Colman further emphasized that tensions in the Middle East have added to the bullish sentiment surrounding gold, though acknowledging that these risks have only recently intensified and not been a predominant theme over an extended period. The escalation of geopolitical tensions underscores the role of gold as a traditional safe-haven asset, attracting investors seeking shelter from market volatility and geopolitical uncertainties.
As the conflict between Iran and Israel unfolds, market participants will closely monitor developments in the region, with gold likely to remain a focal point for investors navigating through uncertain times.
