Dubai gold rate slips nearly Dh5 - but some shoppers buy even at 'record price'

Dubai: The Dubai gold rate has dropped by Dh4.75 a gram over the last few hours to Dh378.25 for 22K – but it’s still far from being at a ‘shopper-friendly’ level. But it will still be a partial relief for many because at several points last Friday, the local price did threaten to shoot closer to never-before-reached Dh390 levels for the popular 22K version. (The 24K continues to be over Dh400, at Dh408.5 a gram.)

“Prices will again seem favourable for regular gold buyers at or under the Dh370 level,” said a jewellery retailer. “Anything higher will be seen as a steep premium. But we have been seeing UAE resident-shoppers buying gold even at the record price of Friday last. Some shoppers didn’t seem to mind at all. They just had to buy gold.”

It could be these shoppers are 'preparing' for the next big jump in gold prices, with some in the trade talking about Dh400-Dh410 levels for 22K by year-end.

It is also another indication that when it comes to gold, its appeal with consumers in markets such as the UAE shines bright - whatever the price.

Since noon yesterday, gold prices were seen slipping in the global market and currently is below the $3,400 an ounce mark, as concerns that there would be a huge spillover from the Israel-Iran attacks subsided, at least for the moment. (Stock markets too have risen in accordance with that sentiment.)

There had been a sizable rush into gold buying as soon as the first attacks took place early Friday. That was the reason for the Dubai gold rate to go past the Dh383 mark later that day – and beating the previous record of Dh381.75 set in April.

But the surprising part is that even on Friday and over the weekend, when the price stuck to Dh383, there were shoppers willing to pay the ‘premium’.

At one of the Dubai Gold Souq stores, there was a purchase of jewellery weighing 40 grams by an Indian shopper. “We had suggested that he could consider waiting for Monday to see whether prices could – but he still went ahead with the purchase spending close to Dh20,000,” said a retailer.

"The shopper did say he was buying for a wedding - but many others would have waited."

For others, though, it's still time to wait and see if gold prices settle back to 'normalcy'.