Dubai: Gold price continued an upward march for the second consecutive day on Tuesday, December 24. But is thi a better time to buy or sell? What are people leaning towards?
As of 3.46 pm on Tuesday, the gold rate stood at Dh180.50 per gram for 24 carat gold in the morning, Dh180.75 per gram in the afternoon. On Monday, December 23, the price per gram for 24 carat stood at Dh179.50. As for 22 carat gold, the rate touched Dh169.50 per gram and went higher up to Dh169.75 per gram in the afternoon. On Monday, 22 carat gold was as low as Dh168.75 per gram. For 18 carat, the gold rate stood at Dh138.50 per gram in the morning of Tuesday, December 24, Dh138.75 per gram in the afternoon. On Monday, gold rate was Dh138 per gram.
What does this mean?
According to Chirag Vora, Managing Director of Bafleh Jewellers, people are exchanging their old gold jewellery pieces for new ones, owing to rising gold rates. “It is a major market norm. In the year 2019, gold rates have been seeing a significant rise in price. “Gold price saw a significant rise in the first quarter of the year while having stabilised and being range bound in the second quarter of the year. This double digit rise assisted in building customer confidence in the yellow metal as a safe haven for investment as well.”
“As a jeweller, we suggest people exchange their gold, rather than sell it. It is also good to purchase gold periodically so prices average out. For example, if you buy a certain amount of gold in the month of August for let’s say Dh140 per gram and again in December for 168 per gram, then your average price of investment in gold will be around Dh154 per gram.”
Consumers want to wait and see
KP Abdul Salam, Group Executive Director, Malabar Group, said: “Consumers always take a ‘wait and see’ approach on the price variations of such magnitude. They normally watch the movement for a couple of days before making their move to purchase or sell their gold. Currently customers are waiting.”
“Gold is the only investment which is on a positive trend. With gold rates spiking, one of the main advantages of selling gold is that it can be easily liquidated. Those who bought gold at lower rates can expect to make a profit as prices are high.”
Gold is an easy commodity to sell
Salam said gold is an easy commodity to sell considering that it is an ideal investment compared to other asset options. “Gold can be sold easily without having to alter the price. In addition, it is a movable asset whose value does not witness depreciation with uncertain economies. Moreover, as we have seen buying gold from the UAE makes more sense since we get better design as well as rates for jewellery for our money from this market.
“Having said that, although there has been a slight increase in the price of gold we expect the demand of gold to remain on par with our expectations as the holiday season draws nearer. For sure, there will inevitably be those who will look to sell their gold but there will be a significant proportion of customers who will hold on to their gold in anticipation of further increase in the price of gold.”
He said people in the UAE are very fortunate as the consumer law favours a very transparent and fair way of dealing with gold. The prices of gold update regularly which is standardised and with this upward trend it can be a good time to buy before prices rise even further.
Salam said the jewellery group sees a number of growing number of younger people buying gold and jewellery as well.
Gold remains on par with expectations
Anil Dhanak, managing director, Kanz Jewels said: “Although there has been a slight increase in the price of gold we expect the demand of gold to remain on par with our expectations as the holiday season draws nearer.”
“Gold is one of the few assets which can be readily sold with minimal time and hassle. Those looking to offload and liquidate their assets will turn to the gold they have at hand.”