UAE gold prices drop: Residents save up to Dh1,000
Gold jewellery sales and footfall in stores across the UAE have surged as falling gold prices accelerate consumer demand.
Buyers are saving up to Dh1,000 on a 10-grm purchase after prices dropped more than Dh100 per gram in March as global rates fell amid the Middle East conflict that broke out on February 28, jewellers say.
Earlier in January, the 24K gold per gram had climbed to record levels of Dh666. It traded at Dh553 on Wednesday. 75 a gram, a drop by almost Dh112.
Spot gold worldwide was then 3.2 per cent higher from noon on Wednesday at $4,542 an ounce.
And, after a slight midweek bounce, prices are still far below their recent high.
“The price correction provided a boost to consumer sentiment,” said Shamlal Ahamed, managing director of international operations at Malabar Gold and Diamonds.
“The sudden drop in gold prices has made it a good buying opportunity, leading to an increased footfall and sales,” he added.
He also said customers were increasingly using advance payment schemes to lock in rates.
“If prices go down, customers get the lower price; if they go up, they keep that locked-in price,” he said, referring to the company’s 10 per cent advance plan and long-term options.
Bigger purchases, stronger demand
People who were hesitant to buy now feel comfortable entering the market,” said Chirag Vora, managing director of Bafleh Jewellers.
“There is an obvious move toward bigger, bolder pieces of jewellery that were previously viewed as too expensive,” he said.
He said those factors, plus demand for gifts around Eid have created a “perfect storm” for sales.
“Footfall has Spiked When Compared To Pre-drop Levels, and the sales during Eid Lajawab — when shops open and people break their fast together — have been better than estimated.” Average basket sizes are also rising due to a savings of as much as Dh1,000 on a purchase of 10 grams,” he said.
Eid boosts momentum
According to Anil Dhanak, managing director of Kanz Jewels, shoppers are making quicker decisions as prices have softened.
“Recent rain slightly impacted store visits, but demand is expected to bounce back sharply,” he said.
The price drop's timing has also added to the momentum of Eid shopping, he said.
“Customers are purchasing for Eid but also looking ahead to weddings and future events,” he said.
This correction has brought market activity back, said John Paul Alukkas, CEO of Joyalukkas Jewellery.
“Clients who had been waiting for the right entry point are buying with confidence now, both for weddings and as investment,” he said.
Eid demand as well as positive pricing, he said, provide strong sales momentum.
“We are experiencing a noticeable increase in footfall, as well as in sales compared to both recent weeks and the same time last year,” he said.
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