Dubai: Gold jewellery prices soared higher on the first trading day of the week, hitting their highest level since late last year.
Unfavourable economic data in the US failed to stop spot gold from rising to as much as $1,322.13 an ounce on Monday, the highest level the precious metal has reached in nearly four months. Gold had risen to a peak of $1,334.34 last 15 September 2017.
As of 10.05am, 24-karat gold was trading at Dh160 per gram, up by Dh1 from Thursday’s rate. The last time 24K was retailing at the same price level was sometime in September last year.
Other gold pieces have gone up as well, with 22K, 21K and 18K retailing at Dh150.25, Dh143.25 and Dh122.75 per gram, respectively.
The yellow metal has been doing well recently and it has managed to open 2018 with a bang. Over the last few weeks alone, prices climbed nearly ten per cent, causing jewellery prices in the UAE to soar at the same time the value-added tax (VAT) started taking effect.
Most gold jewellery retailers in the UAE started collecting VAT last 1 January 2018. A few of the shops, including those operated by Pure Gold Jewellers, opted to absorb the tax, but only for the month of January.
“Astonishingly, gold prices have rallied by more than seven per cent during the last three weeks and despite last week’s unfavourable US data regarding unemployment claims [and the US] dollar was able to sustain the support levels,” said Century Financial in its weekly market report.
“The fundamental rationale for holding its support level could be attributed to the global complacency over trajectory of US rates which might come faster than the market expectations. This could impede the ongoing rally in precious metals. Further the phenomenon of a soaring Global Equities Market makes an investment in a safe haven asset unlikely.