UAE: Gold Soars to $1,911.20 per Ounce, Eyes Further Gains in June

Published June 1st, 2021 - 11:30 GMT
UAE: Gold Soars to $1,911.20 per Ounce, Eyes Further Gains in June
Analysts say that the price of the precious metal will remain skewed upward due to low activity in the equity market in the month of June. (Shutterstock)
Highlights
Most of the moves in the gold prices are primarily due to the weakness in the dollar index, analysts said.

Gold prices rose on Tuesday morning, trading to a nearly five-month high due to softening of the US dollar and rising inflationary pressure.

Analysts say that the price of the precious metal will remain skewed upward due to low activity in the equity market in the month of June.

Spot gold was up 0.18 per cent at $1,911.20 per ounce by 9.35am UAE time on Tuesday. Last week, gold prices hit their highest since January 8 at $1,912.50.

In the UAE, 24K retail gold price rose Dh0.25 to Dh231.25 per gram at the opening of the market on Tuesday morning. Meanwhile, 22K, 21K and 18K were trading at Dh217.25, Dh207.25 and Dh177.75 per gram, respectively.

The dollar index was down 0.3 per cent against its rivals, making gold less expensive for other currency holders.

Naeem Aslam, chief market analyst at AVA Trade, said most of the moves in the gold prices are primarily due to the weakness in the dollar index.

“It seems that traders have become too complacent about this trade, and they firmly believe that the major trend when it comes to the gold price is mainly skewed to the upside. They are simply just not worried about any strength coming back in the dollar index, and this is leaving them wide open to get caught for a complete surprise. This is especially true if we look at the two important events mentioned, which have massive potential to bring higher moves in the dollar index,” he said.

“Gold prices continue to find more bids because June isn't a month when stock markets usually roar. Hence, many traders may continue to buy some protection for their portfolio, and this could come in terms of buying gold,” added Aslam.


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