Gold prices in the United Arab Emirates went up on Tuesday. The cost per gram hit 527.46 AED, a rise from 524.83 AED on Monday. The price for gold per tola also increased to 6,152.18 AED from 6,121.50 AED the day before. These prices are based on international rates adjusted for the local currency and measurements by FXStreet.

The Role Of Central Banks

Central banks are the largest holders of gold. In 2022, they added 1,136 tonnes, worth $70 billion, to their reserves. Gold prices are affected by geopolitical instability, interest rates, and the strength of the US Dollar. When the Dollar is weak, gold prices usually go up, while a strong Dollar can keep prices stable. Gold prices are currently rising, which is a trend we should pay attention to. This small increase indicates larger tensions in the market. For traders dealing with derivatives, it’s time to evaluate the factors that could lead to a breakout. Central bank purchases remained very strong in the last quarters of 2025, supporting the price of gold. The World Gold Council noted that central banks added 800 tonnes in the first three quarters of last year, showing a strong preference for tangible assets. This ongoing demand creates a solid foundation for prices, reducing the risk of sharp declines.

Market Expectations And Futures

Market predictions now include possible interest rate cuts from the Federal Reserve by mid-2026, which puts pressure on the US Dollar. A weaker Dollar and lower yields generally boost gold prices. This situation makes long positions in gold derivatives especially appealing. Additionally, ongoing geopolitical tensions from 2025 continue to provide a safe-haven appeal for gold. If global conflicts escalate, we can expect significant price increases and higher volatility. Given this, having some gold exposure is a smart strategy. In this environment, consider buying call options on gold futures or ETFs. This approach allows for potential gains while limiting our risk to the premium paid. Slightly out-of-the-money calls with expirations in the next three to six months might offer the best opportunities. For those looking to protect their overall portfolios, gold futures can help offset potential downturns in the equity market. Looking back at the market uncertainties in 2025, portfolios with gold fared much better during risky times. This inverse relationship with risk assets is a key factor to leverage in the coming weeks. We saw a similar situation after the 2008 financial crisis when low interest rates led to a long bull run in gold. Between 2008 and 2011, gold prices more than doubled, illustrating how strong these factors can be. History shows we should be ready for a significant rise in prices. Create your live VT Markets account and start trading now.

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