Low gold prices and promotions have yet to boost sales in Abu Dhabi's lacklustre gold market. Retailers are hoping for better times and consumers are adopting a wait-and-watch approach, sources said.

The slump has forced five or six retailers to close shop in recent weeks at the old souk.
"The market is very slow, but is getting better during Ramadan," said Tushar Patni, chairman of the informal gold and jewellery group.

Low prices have not really encouraged a loosening of consumer purse-strings, a jeweller said. "Most consumers are adopting a wait-and-watch policy, anticipating a further fall." The coming days are crucial because dealers are pinning their hopes on festival and holiday purchases, Patni said.

Retailers in the new gold centre at Madinat Zayed also said they were suffering from poor sales. "But it is not all gloom and doom. The market may perk up suddenly as has happened in previous years," said a retailer.

Abu Dhabi's gold trade, unlike Dubai's, is more retail than wholesale and the trade is fragmented in three different locations. If prices drop further, it could spark a buying spree. "You cannot say when the central banks in some countries plan to sell their gold. If this happens, prices could dip, leading to more buying," a retailer said.

According to Raj Soni, director of Indian Jewellers, a noticeable trend is that towards precious and semi-precious studded jewellery. "There seems to be a drop in overall interest for gold jewellery, but studded jewellery is pulling in more business, percentage-wise," he said. Sales, however, of TT (ten tola) bars and gold coins have not been encouraging, traders said.