High prices hit Dubai's gold sales in January

Dubai: High gold prices weighed on Dubai's gold sales in January, depressing volume by at least 35 per cent, a top industry executive said.

"Even with the sales promotions we had, sales volume was quite down last month because of the levels of prices gold reached during this period," Tawhid Abdullah, managing director of the Dubai Gold and Jewellery Group said.

"If you also look at February, it looks like sales volume will be down by about 30 per cent. People are not yet accustomed to the recent hikes in prices," he said.

Gold rose more than 30 per cent in 2007 amid safe-haven buying due to credit market turmoil and worries about the health of the US economy, which sent the dollar to record lows, as well as record high oil prices.

Bullish sentiment helped the precious metal to advance and trade near Thursday's record high above $950 an ounce.

Traders had hoped gold jewellery retail demand would be upbeat if prices drop below $900 an ounce.

Dubai, known as the "City of Gold", saw the volume of gold sales in the fourth quarter drop 30 per cent on the year as high and volatile prices scared many buyers, Abdullah said.