Gold prices in the United Arab Emirates have risen, according to FXStreet. On Tuesday, gold cost AED 554.26 per gram, up from AED 551.73 on Monday. The price per tola also increased, reaching AED 6,464.73 compared to AED 6,435.22 the day before. Gold prices in AED reflect international rates adjusted for the local currency. These rates are updated daily and serve as a reference, but local prices may vary. In 2022, central banks around the world bought 1,136 tonnes of gold, valued at about $70 billion. This was the highest annual purchase ever recorded and shows that gold is seen as a stable asset during economic uncertainty.

The Impact on Global Economics

Gold often moves in the opposite direction of the US Dollar and US Treasuries. When the dollar weakens, gold prices can rise. Economic instability usually boosts gold’s value, and changes in interest rates also impact prices. Lower interest rates tend to make gold more attractive because it doesn’t earn interest. Since gold is priced in dollars, any fluctuations in the dollar notably affect its market value. Gold is currently climbing past $4,700 an ounce. Its safe-haven status is drawing investors away from riskier assets due to rising geopolitical tensions in areas like Greenland. This market uncertainty is pushing people toward the safety of precious metals. For derivative traders, watching market volatility will be crucial in the coming weeks. The VIX, a key measure of market fear, has risen to over 35, a level not seen since late 2024. This suggests that buying call options on gold futures is still a good strategy since implied volatility is expected to stay high. The trend of central banks buying gold seems to be ongoing. Recently, the People’s Bank of China reported adding another 20 tonnes to its reserves in December 2025. This indicates that major institutions are still looking to hedge against currency risks, providing solid support for gold prices.

Investor Strategies Amidst Market Changes

We should keep an eye on the relationship between gold and the US dollar. With EUR/USD strong above 1.1650, the weakened dollar is benefiting gold prices. Additionally, S&P 500 futures have dropped nearly 5% in January, reinforcing the classic shift towards gold. As trade conflicts intensify, there is a higher likelihood of a global economic slowdown. This may prompt the Federal Reserve to rethink its monetary policy later this year. Any indication of future interest rate cuts could further drive up gold prices, as it reduces the opportunity cost of holding gold. Create your live VT Markets account and start trading now.

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