Retail gold prices in Dubai up by 0.18 per cent

07/10/2015 06:08 AST

Gold slowly edged its way back up, with retail prices in Dubai posting less than one per cent gain on Tuesday morning, benefiting from weak economic data.

Gold analysts are expecting that the sluggish hiring figures in the US, coupled with financial markets volatility, will deter the Federal Reserve from increasing the interest rates before the end of the year.

The bullion was little changed at $1,136 an ounce by 0337 GMT, according to a Reuters report. In the previous session, the precious metal had increased to $1,141.80, the highest since Sept. 28, before closing down 0.2 per cent.

In Dubai, the price of 24-carat gold went up by 0.18 per cent, from Dh136.50 to Dh136.75 per gram. For 22-carat gold, buyers can expect to pay a little bit more, with the retail price rising from Dh129.75 to Dh130, while 21K and 18K gold rose to 124.75 and Dh107.75, respectively.

Gold market experts had earlier said they expect the precious metal to trade higher this week after weak employment data in the United States dampened interest rate hike expectations.

Hiring in the United States slowed down last month, with the economy adding only 142,000 jobs in September, much lower than the 304,000 forecast.

The Federal Reserve decided last September that it would stand pat on a rate increase. If there is going to be a rate adjustment, analysts said it would likely happen in 2016.

Citibank said it sees the Fed increasing the rates only in the spring of next year. “This would take the policy rate to just 1 per cent at yearend of 2016. The ECB’s (European Central Bank’s) willingness to increase QE (quantitative easing) will likely grow to the extent the Fed delays hiking,” the bank said in its research note.

Gulfnews