Gold prices showed limited movement during the second week of December. This trend followed reports about a possible interest rate cut in the United States. In addition, comments from Federal Reserve Chair Jerome Powell and statements by Donald Trump influenced the market.
As a result, gold prices stayed within a narrow range. The price per ounce failed to break above $4,250. At the same time, it did not fall below $4,181.
In the domestic market, gold prices followed a similar pattern. The average price of one mithqal of 21-karat gold reached a high of 852,000 dinars. It dropped to a low of 838,000 dinars. Meanwhile, one mithqal of 18-karat gold stood at 726,000 dinars. A 22-karat Dubai lira reached $910.
These figures reflect the current balance in the local gold market.
When compared with gold’s overall performance this year, the current movement appears normal. It does not signal unusual behavior. This is especially true after recent remarks by Jerome Powell.
However, several key factors explain why gold prices have remained steady in December.
- Key Factors Affecting Gold Prices:
First, the year-end period has arrived. Many futures contracts are expiring. As a result, trading activity slows. However, activity usually picks up again in January. More money returns to the markets. The effects often appear more clearly in February and March.
Second, global markets have sufficient gold supply. Major exchanges such as London and New York remain well supplied. Regional markets important to the Kurdistan Region, including Dubai and Istanbul, also face no shortages. Still, December demand remains weak. Therefore, prices move within a tight range.
Third, companies are closing their financial accounts for the year. Some firms convert part of their gold holdings into cash. They do this to calculate profits and losses. Others sell gold after securing profits and prepare for new investments next year.
Fourth, year-end holidays reduce market activity. Many traders and dealers slow daily trading and limit new contracts.
So far, gold has failed to break above $4,280. If the price remains above this level, it could signal a move toward a new peak of $4,380.
However, if gold fails again, two scenarios remain. First, prices may stay between $4,180 and $4,250. Second, prices could decline. A break below $4,160 would be negative. In that case, gold could fall toward $4,120 or lower.
Looking ahead, indicators suggest gold will continue its upward trend in 2026. JPMorgan, Goldman Sachs, and Morgan Stanley all expect stronger gains. They forecast gold prices between $4,900 and $5,000 per ounce.
As a result, the price of one mithqal of 21-karat gold could gradually rise to 900,000 dinars, then 950,000 dinars. If gold reaches $5,000 per ounce, the price could climb to 985,000 dinars.
This outlook depends on the stability of the Iraqi dinar. If the exchange rate stays at 142,000 dinars per $100, prices may follow this path. However, if the dinar weakens, gold prices would rise further.
