Gold edges back toward recent highs, lifting Dubai rates

Dubai gold prices have edged back up towards recent highs, lifting the 24-karat rate to Dh534.50 per gram on Tuesday morning. This pushes 22-karat gold back to Dh495. The 24K rate rose Dh3.75 from Dh530.75 the previous day, while 22K gained Dh3.50 from Dh491.50.

Since the start of September, Dubai gold rates for 24K have fluctuated between Dh522 and Dh542. The price began September 1 at Dh522, then rose to Dh528.25 the next day, peaking at Dh542 on September 3. After easing to Dh532.25 on September 4 and Dh533.75 on September 5 and 6, it fell to Dh530.75 on Monday before recovering on Tuesday morning.

The 22K rate followed a similar pattern, starting the month at Dh483.25 and reaching Dh502 on September 3. It then dipped below Dh500 before settling at Dh495 on Tuesday morning. Rates for 21K and 18K have also increased since the beginning of the month.

Chris Weston, Head of Research at Pepperstone, notes that gold prices are in a "battle between buyers and sellers," with neither side displaying enough conviction to drive a sustained directional move. Factors such as Chinese demand, with the People's Bank of China adding 630,000 ounces of gold to its reserves, and US inflation data remain crucial for the market.

The majority of 76 economists surveyed by Bloomberg expect the Federal Reserve to keep interest rates unchanged, with a 63% probability of a rate hike according to US market projections. Treasury buyback operations starting this week and potential US dollar weakness ahead of the Federal Reserve meeting are also factors being watched by traders.