Bullion continues to weaken on the back of a strong US dollar
The gold jewellery market in Dubai offered more opportunities for bargains on Monday, as the precious metal traded at its lowest level in about two weeks.
Spot gold dropped to $1,276 an ounce as of 9.53am, down from a little over $1,306 in October 16.
Other jewellery pieces dropped in value as well, with the 22K trading at Dh145.25 per gram, 21K at Dh138.50 and 18K at Dh118.75.
Gold’s weakness has been attributed to a bullish American currency. The US dollar has clawed higher against other currencies, as news about tensions between the United States and North Korea dissipated and tax reforms in the United States bolstered investor appetite.
The greenback rallied to a three-month high against the Japanese yen to 113.56 and a five-month high against the Swiss franc at 0.9858.
“Investors also have viewed as bullish for the dollar remarks [last week] from [US Federal Reserve] chair Janet Yellen and other officials that suggest the central bank is moving forward with another rate hike this year,” said Century Financial Brokers in a note.
“There’s no news on North Korea this past week or so. If some news comes out, gold might be supported but at the moment, people are just watching the dollar,” Reuters quoted Yuichi Ikemizu at ICBC Standard Bank in Tokyo as saying.