Dubai Gold Update: Prices drop to six-weeks low

Gold fell on Friday, inching towards the previous session’s six-week low as the dollar strengthened, with prices set for their biggest monthly fall this year.

The price of 24k gold in Dubai is Dh155.75 and buyers can purchase 22k gold at Dh146.25.

Spot gold declined 0.2 percent to $1,284.28 per ounce at 0434 GMT, on track to register a 2.8 percent decline in September, the largest monthly fall so far in 2017 and the biggest monthly drop since November.

However, it was set to end the quarter up around 3.5 percent after prices rose in July and August.US gold futures fell 0.1 percent to $1,287.70 per ounce. Gold is mostly being influenced by the dollar’s movements in an otherwise quiet session, said Yuichi Ikemizu at ICBC Standard Bank in Tokyo.

The dollar rose against a basket of major currencies on Friday. The greenback pulled back from a one-month high reached earlier on Thursday as investors this week were supportive of the Trump administration’s tax plan and the outlook for Federal Reserve policy.

“As long as nothing happens on the North Korea front, I guess we’ll have a pretty quiet Friday,” Ikemizu said.Russian and North Korean officials will meet in Moscow on Friday to discuss the North Korea crisis.

“(Gold) will likely continue to struggle in the short term against a backdrop of higher interest rates, particularly in the US and possibly in the UK and Europe,” said INTL FCStone analyst Edward Meir.

Proposed US tax reforms and strong economic data that supported the case for another U.S. interest rate hike this year have weighed on gold.

Gold is highly sensitive to rising US interest rates, which increase the opportunity cost of holding non-yielding bullion, while boosting the greenback.

Meanwhile, palladium gained 0.7 percent to $935.05 per ounce. It was up 11 percent for the quarter and 38 percent so far in 2017.