UAE gold prices gain Dh7.75 as Fed holds US interest rates

19/06/2026 01:54 AST

Gold prices rose in the UAE on Thursday after the US Federal Reserve kept interest rates unchanged.

The 24K variant was trading at Dh519.75 at the market open on Thursday, up from Dh512 the day before.

Among the other variants, 22K, 21K, 18K and 14K were trading at Dh481.50, Dh461.50, Dh395.75 and Dh308.50 per gram, respectively.

Spot gold was down 1.05 per cent at $4,316 an ounce 9.20am UAE time, while silver was steady at $69.03 per ounce.

The US Federal Reserve on Wednesday kept interest rates unchanged, maintaining its benchmark rate despite persistent inflation concerns. The central bank also raised its year-end inflation projections, signalling that policymakers remain cautious about cutting rates in the near term.

Nick Spencer-Skeen, Senior Executive Officer at Lunaro Financial Markets, said investors are closely assessing the policy direction under Fed Chair Kevin Warsh amid signs that inflation remains resilient and the US economy continues to show strength.

"Markets have already tightened, with rates now pricing around 20 basis points of hikes by year-end and roughly 30 basis points by mid-2027. That repricing reflects the backdrop of resilient inflation alongside a robust labour market," he said.

Spencer-Skeen noted that inflation remains the Fed's biggest challenge, with Core PCE rising to 3.4 per cent year-on-year from 3.0 per cent at the start of the year. "There's the potential for policymakers to place greater emphasis on managing upside inflation risks, although it's unlikely there will be any firm commitment to raising rates at this stage," he added.

Lower interest rates generally support gold prices as the precious metal becomes more attractive compared with interest-bearing assets.

Because the Emirati dirham is pegged to the dollar, the UAE Central Bank also maintained its benchmark rate at 3.65 per cent, following the Fed's decision.

Earlier this week, the Fed raised its inflation forecast for the Personal Consumption Expenditures price index, its preferred inflation gauge, indicating that price pressures could remain elevated for longer than previously expected. Policymakers have reiterated that future rate decisions will depend on incoming economic data and progress in bringing inflation closer to the central bank's target.

Khaleej Times