Gold jewellers are optimistic about brisk sales activity despite an exponential surge in yellow metal prices in past few weeks as they said demand will pick up once the festive season begins next month. Leading jewellers and experts said rising price is irrelevant for some of the consumers as they will purchase gold jewellery because of religious grounds like Diwali or Christmas or social obligations such as weddings, birthdays and anniversaries. However, most of the buyers adopt wait-and-see policy to closely monitor price trend and make a decision when prices will come down.
"Recent price hike of gold has an immediate effect on the market. This is the highest price gold recorded in past 7 years," Abdul Salam KP, group executive director, Malabar Group, said. Gold prices sustained an upward trend in past few weeks and surpassed the $1,550 per ounce mark for the first time in more than 6 years on Monday due to the US-China trade war, geopolitical tensions in the region and slowdown in global economy. The metal had hit its highest level since April 2013 at $1,554.56 on Monday and then eased to $1,529.81 per ounce on Tuesday.
"Consumers always take a 'wait-and-see approach on the price variations of such magnitude. They normally watch the movement for the next few days, and if the trend continues or price set, they take purchase decisions," Salam said.
Market leaders said the current price increase gives lot of confidence to gold buyers internationally in general and GCC in particular. Currently, the 24k gold is quoting at around Dh185 per gramme as against Dh144.75 in corresponding period of last year while 22k gold climbed to Dh170 from Dh136 in same period last year. So Gold is poised to emerge as safe haven as investors are currently interested to book profits at high prices. "We are sure that the customer confidence in gold will bring back customers to the market soon and will show a good growth in sales in the coming weeks," added Salam.