Residents and tourists crowd into gold shops as prices fall

UAE – Gold traders are signaling a sharp rise in demand for the precious metal as prices fall. Some retailers are reporting a 20% increase in demand following the fall in prices, Eid Al Adha and the summer holidays and the pent-up market after the pandemic.

Most buyers are UAE residents, tourists and transit passengers en route to the United States, Canada and the United Kingdom, said Joy Alukkas, president and CEO of her eponymous jewelry brand. . He said: “Most buyers buy gold jewelry for use and investment purposes. The trends of people buying bars in our stores are not as important. »

Gold prices fell more than Dh2 per gram in the UAE on Thursday morning, trading near a one-year low. Data from the Dubai Gold and Jewelery Group showed 24K trading at Dh205.0 per gram on Thursday morning compared to Wednesday’s close at Dh207.25 per gram. Prices rose from 192.50 Dh per gram for 22K to 194.25 Dh on Friday.

“Friday’s price spike didn’t really impact demand, to be honest. The trend over last year has been extremely positive since Akshaya Tritiya (celebrated May 3). Post- pandemic has been very positive,” Alukkas said.

In addition, the majority of buyers are people aged 35 and over. “They are the decision makers. Indian tourists who flock to the UAE are also buying gold,” he added. Moreover, trends are almost immediate since residents can easily monitor prices online through social media and internet penetration.

“We are also seeing the same trend in our exchange centers. People take advantage of the prizes almost immediately,” Alukkas explained.

Anil Dhanak, Managing Director of Kanz Jewels, said, “Our retail customers are taking full advantage of these lower prices, and despite the summer heat, we are seeing people eager to visit our stores and purchase jewellery.

Dhanak said investors understand that this decline could be temporary and could see a return to the $1,800 level. “Safe-haven assets such as gold are going to be in everyone’s portfolio during these uncertain times,” he explained.

However, Dhanak said the demand for gold, especially the 24,000 bullion bars, is on the rise. “Even with a slight increase in the price of gold per ounce, we are seeing a large number of buyers entering the market to reduce their portfolio risk,” he explained.

Chirag Vora, the director of Bafleh Jewellery, said: “The drop in prices as well as the start of the summer holidays have contributed to the increase in sales. Traditionally, people, especially those in the subcontinent, buy gold when they return home for their holidays. This year, the low price has been a boon for gold travelers going on vacation, helping boost sales.

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