In two weeks, UAE gold rate for 22K has shed around Dh15/g – and shoppers are back
Dubai: Gold and jewellery shoppers in the UAE have got a big break with international bullion prices dropping to $1,863-$1,865 an ounce levels – and with the Dubai Gold Rate at Dh211.25 a gram for 22K. The price levels are all the more significant given that today (May 3) is ‘Akshaya Trithiya’, regarded as an auspicious day by Indians to buy gold. It is also one of the most significant days for gold and jewellery buying in the UAE.
The Dh211.50 price comes across as highly favourable for shoppers, given that just two weeks ago, the Dubai Gold Rate had crossed Dh226. These days, anything between Dh200-210 a gram for 22K is seen as being conducive to demand – and today’s rate is seen as near enough to that psychologically vital mark. More so, when it is Akshaya Trithiya, and retailers have come out with multiple promotions to help with the demand.
Many gold retailers have brought forward the opening of their stores today, to 8.30am, in anticipation of the heavy buying. This year, retailers say that gold buyers are getting a ‘triple advantage’. “There will be the Eid gift buying happening, plus there will be a lot of demand as many UAE residents are heading for short holidays over the nine-day Eid holidays,” said Abdul Salam K.P., Vice-President at Malabar Gold & Diamonds and a member of the board at Dubai Gold & Jewellery Group.
“If these travellers are spending their holidays in their home country, chances are they will be buying gold here to take advantage of the price difference there.”
UAE retailers are also confident that Dh211.50 (and at 0 per cent VAT) will also prompt visitors/holidaymakers from the GCC spending Eid in UAE to do more than just a bit of gold buying. “Gold prices dropped at the best moment for shoppers and retailers,” said a senior official at one of the bigger jewellery houses. “Dubai Gold Rate at Dh220 or above would not have got a similar response, especially when a lot of consumers are getting careful about spending.”
Plus, of course, there is the added pull of buying on the day of Akshaya Trithiya. Leading retailers are offering gold coins if individual purchases cross certain levels, while others are extending cashback choices. (In most cases, the promotions cover all jewellery purchases, and not just gold.)
“‘Cashback Celebrations'(will be on) offer across all Joyalukkas showrooms until May 8,” said John Paul Alukkas, Managing Director at the retailer.
After dropping to around $1,890, gold prices had shot up past $1,900 all over again in recent days. Then, towards the end of last week, it dropped – and the drop continues. Today’s rate is the lowest since around February 15. (Gold prices had shot up after the launch of Russia-Ukraine hostilities and at one point had even come close to $2,050 an ounce.)
Gold’s yo-yoing has much to do with this week’s US Federal Reserve meeting, and which should see another – substantial – interest rate hike. “If gold continues to slide, the $1,835 level should provide tentative support,” said Edward Moya, Senior Analyst at the FX and commodities firm Oanda. “Gold prices continue to get pummeled as traders price in much more aggressive Fed tightening.”
None of which will matter to gold shoppers in the UAE and elsewhere. They will take all the prices drops they can get.
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