Dubai: A substantial 56 kilograms in gold — with a current market value of Dh7 million — will be on the line for the daily raffle draw winners as part of the promotions during DSF 2016. Not just that, there will be more daily winners this time — with the first winner bagging one kilo, the second 500 grams and the third 250 grams.
Until now, there was only a single winner announced daily who would take home one kilo of the metal. (Last year, 100 kilograms of gold was on offer as part of the various promotions done to mark the 20th anniversary of the Dubai Shopping Festival series. Over 20 years, 843kg of gold have ended up in the hands of lucky winners.)
“Broadening the base of daily winners could prove a major draw in increasing shopper transactions during the promotional run from January 1 to February 1,” said Tawhid Abdullah, who heads the Dubai Gold and Jewellery Group. “This will add to an already favourable situation where gold prices are on the softer side.” (Monday’s trade started with the Dubai Gold Rate at Dh122.5 a gram.) “The best part is that we are again starting to see tourists at the Deira Gold Souq and that’s always been a major plus for the business.”
To be eligible for the draw, a shopper has to acquire gold for Dh500 (which gets him one coupon). It will be two coupons for purchases of diamond or pearl jewellery.
For the better part of this year, tourist-driven sales volumes for the gold trade — and indeed for cross-sections of the local retail sector — have been muted. The strength of the dollar was the factor forcing Russian and Chinese buyers to lower their purchase of the asset. In certain months, their share of overall sales dropped to around the 20-25 per cent mark as against the 40-45 per cent they averaged in the past.
“Even with lower tourists-led buying, the Dubai jewellery sector has had a decent year, with demand down only during the third quarter,” said Abdullah. “But there was enough happening through the rest of the year and backed by sustained domestic shopper demand.
“This is something we are hoping to carry forward into 2016.”
According to Cyriac Varghese, General Manager at Sky Jewellery, “In the days leading up to January 1, when the DSF launches, the overall demand at the outlets have been muted. But this has traditionally been the case in the run up to DSF — shoppers want to increase their chances of winning by buying during the time.
“In the last two days, in particular, we are starting to see a lot more transactions involving visitors, especially those from India.”
Shoppers will also be tracking what is happening to gold prices in the international markets. As was expected, the 0.25 per cent hike in the US base rate did not lead to gold going through any dramatic changes. On December 16, when the Federal Reserve made the decision, gold was trading at $1,075.25 (Dh3,949) an ounce.
“Since then, gold has closed at between $1,062 to$1,078, though it did drop to around $1,047 once in intraday trading,” said Varghese. “That gold prices have not fallen after the US rate increase was because the market had already factored in a 0.25 per cent increase. It would have required a much steeper increase for gold prices to have had an impact.
“But there will continue to be pressure on gold prices — that could come to the Dubai gold trade’s favour during DSF 2016.”
