Stock UAE Gold
Gold's on a comeback - did UAE shoppers take any price safeguards for their Diwali purchases? Image Credit: Ahmed Ramzan/Gulf News

Dubai: International gold prices are back at $1,700 an ounce plus levels, closing the window – for the time being – on UAE gold shoppers’ hopes of soft prices ahead of Diwali on October 22. Gold had been under $1,700 since September 14 and dropped to a more than two-year low of $1,629 on September 27.

“The gold party is over, for now,” said a Dubai-based jewellery retailer. “The focus for us will be on tourist shoppers, because they will still feel $1,700 and just over to be favorable.

“But UAE-based shoppers will not be thinking that way, because their mind will immediately go back to recent days when gold could be bought at under $1,650 levels. We might see a bit of buying support before or on October 22, before Diwali.”

The UAE gold rate early Tuesday is at Dh193.50 for a 22K gram, and the highest in the last 10 days. During its recent dip, the local rate was at one point set around Dh185.75 a gram.

Not too worried

UAE gold and jewellery retailers are not taken aback by gold’s latest upswing. In fact, they had been constantly messaging shoppers that this could happen, and that it would be best they lock in prices when at relative lows.

“We had seen some heavy booking when prices were at Dh187 a gram, and these sales would be completed by October 22,” said another retailer. “I don’t think too many resident shoppers waited for prices to drop further, and were taking precautions not to pay higher when they do the Diwali shopping.

“For them, the decision to book has paid off.”

Other jewellery sources say this was the first time that online booking played such a part in UAE gold buying. Or more specifically, to book and lock the prices.

What next for gold?

Global markets, stocks and commodities, are taking a mini-breather after the panic that engulfed it last two weeks. Gold too was caught up in the whirl, which saw the price drop. The upturn to $1,700 levels shows investors piling back in (which always happens at the expense of shoppers).