Dubai: The sparkle is back in the UAE’s gold and jewellery market, with shoppers starting to make a slow return with bullion prices dropping to ‘consumer-friendly’ levels. Early on Wednesday, gold is at $1,815 an ounce, but what will be of more value to potential shoppers is that the price had even dropped to $1,805, though briefly.
The Dubai Gold Rate closed June 14 at Dh206.75 a gram.
In the last two days, gold prices have been in retreat, down from $1,850 levels. “Anything close to $1,800-$1,810 levels would be seen as affordable by shoppers here, including tourists,” said a retailer. “Since yesterday (June 14), we have got calls from shoppers wanting to book at current rates – but many will decide seeing how gold performs in these next 48 hours.”
That’s right, the next 48 hours, which will see the US Federal Reserve raise interest rates and which will be matched by central banks in the UAE and Gulf given the currency peg to the dollar. The dollar will derive more strength from a rate hike – and another is coming in July too – and that could see gold prices shedding some more value.
Any value lost is a gain for a shopper. And gold had been sticking to well over $1,850 plus levels for some time now. Retailers expect more calls from their regular shoppers and more visits today. “Even if they are coming just to make enquiries, it would be fine,” said a retailer. “It’ been weeks since we have seen some traffic – the last good one was during the ‘Akshaya Trithiya’ in early May.”
- As a gold and jewellery shopper, does the current price levels interest you? Or are you expecting a further drop?
- If you expect prices to drop further, make the call to your jewellery retailer. Ask him to lock in at today's rates and with the promise of buying in one- or two months.
- If prices drop further, you will still get the lower price.
- And should gold rates firm up during this period, you are still protected from the upside.