Gold price drops near $40/oz - and UAE shoppers have already been buying
Current rates set up busy sales between Aug. 26-28, and tourists are back to buying too
Dubai: These days, UAE’s gold shoppers are not delaying their purchases – each time, there is seen to be a clear decline in prices, they are making their next purchase. The same process happened over the last weekend, with the Dubai Gold Rate at Dh198 a gram for 22K proving quite a temptation.
“With all the uncertainty around gold, UAE shoppers prefer to take any price advantage immediately,” said Abdul Salam K.P., Vice-Chairman at Malabar Gold & Diamonds. “August 26-28 sales were among the better weekend numbers the UAE jewellery market has seen this year.
“Each time, shoppers hope that gold will keep dropping – say, to Dh190 levels – their hopes are dashed. It happened in July, and that’s why you don’t see too many shoppers waiting to see further dips. If they feel comfortable with a rate they feel is right, they go all in that day itself.”
Near $40 drop
Gold bullion prices have started the week sliding, and are now at $1,723 an ounce. A further skip towards $1,710-$1,715 would mean the Dubai Gold Rate inching closer to Dh195 a gram.
Asia Cup and tourists
With the Asia Cup T20 matches taking place in the UAE, the next few days should see more tourists arriving from the Subcontinent, and that’s always a good precursor to more sales for the local gold and jewellery trade. “The final round of Asia Cup matches would be the time when visitor numbers in the UAE should see a significant increase,” said a gold retailer. “If the current price levels persist, we are in for a bonanza.”
- Anil Dhanak, Managing Director at Kanz Jewels
India’s gold duty hike
The coming weeks will also confirm whether there is a marked increase in gold buying among Indian tourists after the country raised import duty on gold bullion to 15 per cent from 10 in July. “Apart from their own use, a sizeable number of Indian tourist buying is to make use of the retail price difference between here and in India,” said a retailer. “UAE gold trade should see a 10-20 per cent boost annually in retail level sales purely from the import duty hike. And the first signs of that increased buying will be obvious from September.”
With a bit of help from UAE gold rate remaining under Dh200. Or well under…
Gold is cheaper since (Jerome) Powell’s speech, and is set to make another attempt below the $1,700 mark, while Bitcoin fell below the $20’000 mark, and is now below the summer uptrending trend. The selloff in equities should further pressure Bitcoin lower. The next natural target for Bitcoin bears stands near $17,500, the June dip, then the $15,000 level, the next psychological support