Dubai gold prices slip slightly. is it the right time to buy?
Gold prices slipped in range-bound trading on Friday as the dollar firmed slightly, with investors mostly brushing off a potential broadening of conflict in the Middle East.
Spot gold was down 0.1 percent at $1,319.61 per ounce as of 0656 GMT, after rising to the highest since end-April at $1,322.76 in the previous session.
24 karat gold was priced at Dh159 in Dubai. As for 22 karat gold, the price was marked at Dh150. The metal was, however, still on track to register a first weekly rise in four. US gold futures for June delivery were nearly 0.2 percent lower at $1,320.20 per ounce.
“I think geopolitical concerns (with respect to recent attacks on Syria) are still a concern but investors aren’t paying significant attention to these,” said Naeem Aslam, chief markets analyst, Think Markets.
“The dollar story is more prominent.” Israel said it attacked nearly all of Iran’s military infrastructure in Syria on Thursday, after Iranian forces fired rockets at Israeli-held territory for the first time in the most extensive military exchange ever between the two adversaries.
Gold is traditionally seen as a safe place to park assets in times of uncertainty or conflict. Meanwhile, the dollar index on Friday edged slightly higher, but still held below a 4-1/2-month high hit on Wednesday, with tepid US inflation data for April prompting traders to pare bets of faster rate hikes by the Federal Reserve.
Fed funds futures, however, rose on Thursday, indicating some traders continued to expect the US central bank to raise key interest rates at its next policy meeting in June.
A stronger dollar makes gold more expensive for holders of other currencies, while higher US rates tend to boost the greenback. Elsewhere, the Bank of England held its interest rates steady on Thursday, while European Central Bank Governing Council member Philip Lane said interest rates are unlikely to move dramatically in the coming years.
“Obviously we have to be cognizant to dollar risk but (tensions) in the Middle East doesn’t look like it’s going to settle anytime soon so I feel confident buying gold on the dips,” said Stephen Innes, APAC trading head at OANDA said.
Asian shares rose on Friday as risk appetite got a boost after US President Donald Trump said he had hopes of “doing something very meaningful” to curtail North Korea’s nuclear ambitions at a summit in Singapore next month.
Among other precious metals, silver rose 0.1 per cent to $16.70 an ounce, having hit its highest in more than two weeks at $16.75 in the previous session. Platinum fell 0.5 per cent at $919 per ounce, having hit its highest since April 25 at $927.20 on Thursday. Palladium was 0.5 per cent lower at $994 an ounce, having marked a more than two-week high at $1,002.10 in the previous session.
UAE’s vat move has gone well, inflation to moderate: IMF
The UAE’s introduction of value-added tax has gone smoothly and inflation, having jumped in response, will moderate, the head of the International Monetary Fund’s mission to the country said on Thursday.
Natalia Tamirisa said the 5 per cent VAT rate imposed at the start of this year was a big cultural and administrative shift in a country that has traditionally had minimal taxation.
“Given the challenges, VAT introduction has been well managed and relatively smooth,” she told to the UAE for talks with authorities.
Annual consumer price inflation jumped to 4.8 per cent in January, the highest since 2015, but dropped back to 3.4 per cent in March.
Tamirisa said the latest data suggested the impact of the tax would be short-lived, partly because inflation had dropped in areas of the economy not covered by VAT.
Slowing real estate markets in Abu Dhabi and Dubai have pulled down residential rents, which are heavily weighted in consumer price indexes.
Inflation is expected to average 3.5 per cent this year, up from 2.0 per cent last, but will ultimately settle around 2.5 per cent, Tamirisa predicted.
She said the new tax was expected to lift revenues by 1.5 per cent of gross domestic product in the long run.
Tamirisa said property market weakness was having an economic impact and authorities needed to monitor this carefully. Average rents dropped 10.2 per cent in Abu Dhabi in 2017 and 5.2 per cent in Dubai, according to the central bank.
“There is persistent supply coming into the market so at least for this year, the balance between supply and demand is likely to keep prices soft,” Tamirisa said.
But partly because authorities had taken steps to limit speculation, the weak property prices did not pose a systemic threat to the economy.
Tamirisa said it was too early to assess the impact on the UAE of the US pullout from the Iran nuclear deal, partly because the impact on Iran itself was not yet clear.
The UAE could benefit if Iran found it harder to sell its oil, giving Arab oil producers more room to boost their crude exports at higher prices.
Emaar launches ‘grande’
Emaar Development’s new Grande residential tower in Downtown Dubai is offering one of the last opportunities to invest in a premium residence in Downtown Dubai, the world’s most visited lifestyle destination.
Ahmad Al Matrooshi, Managing Director of Emaar Properties, said: “Downtown Dubai is today one of the most sought-after residential destinations in the city, offering great value for investors, and a world-class lifestyle for residents. Grande is a spectacular addition to Downtown Dubai, which will add to the skyline of the nation. Residents become part of a thriving cultural and lifestyle hub with spectacular views of Burj Khalifa and The Dubai Fountain, and effortless proximity to Dubai Opera and The Dubai Mall.” Emaar will commence the sale of Grande residences on Sunday. Customers can visit the Emaar Sales Centre in Downtown Dubai, the Dubai Hills Estate Sales Pavilion located on Umm Suqeim Road, the Dubai Creek Harbour Sales Centre in Ras Al Khor, the Emaar South Sales Centre on the DWC Peripheral Road in Dubai South and the Abu Dhabi Sales Centre on the ground floor of Al Nahda Tower on 4th Street, Al Muroor Road. The centres are open from Saturday to Thursday, 8.30am to 6pm. The 78-storey residential tower is located in the heart of The Opera District that is home to the iconic Dubai Opera. Residents become part of one of the most thriving lifestyle destinations in Dubai with spectacular views of Burj Khalifa.
They also live next-door to Dubai Opera, the new cultural hub of the city that hosts leading performers from across the world. Assuring a premium lifestyle in Dubai’s most popular cultural and entertainment destination, Grande features 1, 2, 3 and 4-bedroom apartments, and is a not-to-miss investment opportunity given the demand for homes in Downtown Dubai.
Why oil and gas companies must spend more on R&D
Any organisation cannot be world class without world-class research and development, said oil and gas industry officials at the International Research and Development Petroleum Conference and Exhibition (RDPETRO) in Abu Dhabi on Wednesday.
Opening the 2-day event dedicated to research and development, Adnoc downstream director Abdulaziz Al Hajri said R&D is the backbone of success at any organisation.
“We need to think if we don’t want to sink. The speed of technology development has never been faster and its potential impact is powerful. Natural resources are becoming challenging to unlock. Changing market dynamics require an unwavering focus on cost and value creation. To succeed, we must be more creative, innovative and collaborative.”
“At Adnoc, our response to this new energy era is reflected in our integrated 2030 smart strategy and growth, which aims to ensure a profitable upstream and valuable downstream, a more sustainable and economical gas supply – all underpinned by more proactive and adaptive marketing and trading. Critical to success of strategy is pursuing new R&D and technologies that enhances our performance, optimises cost and enables us to respond reliably and competitively to growing demand for oil and gas and refined and petrochemical products. The common perception of R&D as a cost centre needs to be challenged as the ideation and creation of novel solutions helps unlock significant value. You cannot be a world-class organisation, without world-class R&D. At Adnoc, we are leveraging R&D across the entire value chain.”
Al Hajri said a major development would be announced at the Downstream Investment Forum in Abu Dhabi next week. “We will unveil a multi-billion-dollar refining and petrochemical transformation and growth scheme that will have advanced technology and innovation at its core.”
Qasem Al Kayoumi, technical centre manager at Adnoc upstream directorate, said effective innovation in R&D has huge potential to increase productivity, efficiency and enable growth. The RDPETRO 2018 chairman said that amid challenges faced in the industry, the interest in R&D is growing. “Oil and gas companies are increasingly looking for more creative ways to solve challenges, maximise value and succeed in the new energy era – from novel drilling and well completion methods, to refining or processing technologies, from new hi-tech infrastructures, material and products, to how our industry uses advanced data and artificial intelligence,” Al Kayoumi said.
“RDPETRO is a place where ideas meet investment to solve the global challenges of the oil and gas industry. It is positioned to be an enabler that offers innovators access to end-users, with the potential to tap into multi-million dollar development funds. In response to the industry challenges we set, almost 400 technical solutions, from over 30 countries and more than 130 institutions, were received and evaluated.”
The chief technology officer summit where experts discussed how advanced technology, digitalisation and Artificial Intelligence will disrupt the oil and gas industry.
The experts looked into digitalisation, big data, visualisation, mapping, sensor technology and beyond to examine how the latest technological advances drive new value and solutions for oil and gas.
Air Arabia Q1 net profit up 8% on high demand
Low-cost carrier Air Arabia posted on Thursday an eight per cent surge in net profit to Dh110 million in the first quarter ending March 31, 2018, compared to the corresponding 2017 figure of Dh102 million.
The Middle East’s largest budget carrier said in a statement that it continued to deliver solid commercial and operational results as it flew than two million passengers between January and March 2018, in line with the record number of passengers carried in the first quarter of last year.
The airline’s average seat load factor – or passengers carried as a percentage of available seats – during the first three months of 2018 stood at an impressive 80 per cent, the Sharjah-based airline said.
Sheikh Abdullah bin Mohamed Al Thani, Chairman of Air Arabia, said the strong financial performance for the first quarter is a reflection of the robust business model that the budget carrier operates and is driven by a clear strategy for growth.
“The strong passenger demand combined with the solid cost control measures that we took in driving cost margins lower continue to positively impact the financial performance of the carrier,” he said.
Al Thani said as the airline continues to witness strong customer appeal for its services, it remains committed to investing in innovative and value added products that will provide customers with unmatchable value while traveling by air. “We remain optimistic about the prospects of low cost air travel in the wider region and our ability to continue to report sustained profitability and achieve solid growth margins across our network”.
Taqa’s Q1 profit rises to dh110m
Driven by higher crude oil prices, Abu Dhabi’s state-owned oil and gas producer made a profit attributable to shareholders of Dh110 million in the first quarter, up 42 per cent compared to Dh77 million earned in the same 2017 quarter.
Abu Dhabi National Energy Company (Taqa), which made a turnaround with an annual net profit of Dh171 million in 2017, said in a statement that its revenues in the quarter rose five per cent to Dh4.3 billion versus Dh4.1 billion in the year-ago period.
Taqa is the latest energy company to report higher earnings thanks to resurgence in the price of oil, with the international benchmark Brent trading close to a four-year high. The company cut jobs and slashed spending to cope with a decline in the value of oil and gas properties and lower crude prices, helping it to save about $3.6 billion over the past three years.
Shah Rukh Khan opens conares new plant in Jafza
Bollywood megastar Shah Rukh Khan inaugurated the new plant of Conares, the UAE’s second largest private steel manufacturer, in Jebel Ali Free Zone.
The new state-of-the-art 12” pipe mill, installed with an investment of Dh100 million, now makes Conares a manufacturer of 1-million-tonne steel products annually.
Mohammed Al Muallem, CEO and managing director, UAE Region – DP World, and other senior officials graced the occasion.
Conares is the leading producer of steel pipes and rebars within the region, and the only private manufacturer in the UAE. The company is also amongst the top three steel rebar mills operating 24×7 to serve the upcoming projects in the country.
Bharat Bhatia, CEO of Conares, said: “We are proud to launch the 12” pipe mill, which will increase our pipe manufacturing capacity by 250,000 metric tonnes. This mill increases our pipe product range, enabling us to meet the growing regional demand. With this we have now achieved our milestone of 1 million tonnes capacity of steel production annually.”