UAE gold prices rally continues, but will prices rise further?

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Gold prices continued their upward trend on Thursday due to concerns surrounding the Middle East crisis.

The Dubai Jewellery Group data showed 24K rising to Dh241.0 at the opening of the markets on Thursday, up half a dirham per gram at the close of the markets on Wednesday. Similarly, 22K, 21K and 18K also opened higher at Dh223.0, Dh216.0 and Dh185.0 per gram, respectively.

Spot gold rose 0.4 per cent to $1,988.38 per ounce by 9.26 am UAE time as the Middle East conflict kept investors worried, with safe-haven bullion standing firm despite a stronger US dollar and bond yields.

Daniel McCarthy, strategist, dailyFX, said the spot gold price has rallied going into Thursday's trading session, seemingly defying gravity with the US dollar stronger elsewhere and Treasury yields galloping back after a recent dip.

He said recent moves have seen volatility pick up for gold, which suggests further notable moves in the gold price might evolve.

Investors now await the US GDP numbers for the third quarter later in the day and the PCE price index on Friday ahead of the Federal Reserve's rate decision next week.

"The Federal Reserve clearly sees higher interest rates as a route to reining in inflation," said Nikos Kavalis, managing director at Metals Focus.