By Anwar Ahmad
20 October 2007
ABU DHABI — Gold jewellery sale in Abu Dhabi has witnessed a spurt of up to 40 per cent after mid-September, with brisk sales being reported during the Eid Al Fitr celebrations. However, due to the rise in gold prices, there was a drop of 20 per cent in the sale of jewellery during Eid this year as compared to last year.
The shopkeepers expect gold jewellery sale to increase in the run-up to the Indian festival of lights, Deepawali, in the first week of November.
The people are buying gold jewellery in a very calculated manner due to its price hike, shopkeepers in the Capital said.
Record surpassed
Gold prices have surpassed the 28-year-old record in price hike. In 1980, gold price was Dh72.28 per gram for 24 carat, but the current price is Dh89 per gram. The latest rate for 22-carat gold is Dh83 per gram.
A majority of gold jewellery buyers belong to the subcontinent. Each year from October to January the wedding season in India and Pakistan spurs the sale of ornaments.
When asked whether the increase in gold prices would affect the sale, K.P. Baiju, General Manger of Dubai Gold and Jewellery Group, said, “During the latter part of September, there was a lull in the sale of jewellery. However, the sales picked up considerably during Eid and now the upcoming Diwali festival.”
The Abu Dhabi gold market is totally dependent on Asian expatriates and on nationals because very few Westerners buy gold from here. Most of them make their purchases in Dubai. The Westerners crave for diamonds and most of them usually buy it from shopping malls here in Abu Dhabi.
Answering a question regarding the reason of increasing gold prices in the past several months, Baiju said, “It was not only the high demand of jewellery but also various factors that came into play.
“Varying economic scenarios worldwide and investors’ demands around the world were some of the reasons that resulted in price rise.”
On whether the dollar value was affecting the gold prices, Baiju added, “Yes, certainly. Gold is fast becoming a safe commodity for investors. So is gold jewellery for its value to customers who choose to convert their savings into gold.”
Future use
Nowadays, most of the Asians are buying 22-carat gold coins for saving it for future use.
AI
