Monday 21 May 2018

UAE gold sales up 17pc in 2008

Dubai, February 22, 2009

The World Gold Council's regional office has announced that the UAE gold jewellery sales increased by 17 per cent in 2008 to cross Dh13.7 billion ($3.7 billion) compared to Dh11.4 billion in 2007.

Total gold demand in the Middle East in Q4 of 2008 was up one per cent on the levels of Q4 of 2007. Around 90 per cent of total consumer off take in the region is in the form of jewellery, and weakness in this sector (down seven per cent) largely offset extremely strong growth in the net retail investment (139 per cent).

The surge in investment demand was reasonably widespread across the region, 300 per cent in Saudi Arabia, 67 per cent in Egypt, 38 per cent in UAE and two per cent in other Gulf countries (all compared to Q4 of 2007).

During 2008 as a whole, total off take in the region was down a modest two per cent. The resilience of Egypt were demand rose 12 per cent largely offset weakness in the UAE (-4 per cent ), Saudi Arabia (-4 per cent ) and other Gulf countries (-13 per cent ). The annual figures reflected strong growth in investment demand, but Egypt was the only region to record positive growth in jewellery consumption.

“In the UAE, demand during October’s Diwali festival was particularly strong with the help of lower, more stable gold price during that time,” said Lama Al Saheb, head of marketing and PR for ME region. “Notably, net retail investment was up by 38 per cent. Demand for gold coins and low production cost 22K gold jewellery such as bangles and chains absorbed the benefits of the excess demand.”

“The impact of marketing and promotional gold jewellery campaigns is more important now than ever. The continuous efforts that the World Gold Council and its partners from the gold trade in several countries in the region is essential in order to maintain a healthy gold market environment in the coming period,” added Lama Al Saheb.

Saudi Arabia was also notable for a surge in investor demand. The increase from just 1.7 tonnes in Q4 of 2007 to 6.8 tonnes in same period of 2008 represents a tripling in investment off take.
In Egypt, the jewellery demand over recent quarters has been noticeable for its stability and resilience. Q4 of 2008 was up 6 per cent in tonnage terms on the levels of a year earlier. Over the whole year, the growth rate was 11 per cent.

On an international level, the most striking trend across the year was the reawakening of investor interest in the holding of physical gold. Demand for bars and coins rose 87 per cent over the year with shortages reported across many parts of the globe.

Jewellery demand was up 11 per cent in dollar terms at almost $60 billion for the whole year, but down 11 per cent in tonnage terms at 2,138 tonnes. The adverse economic conditions across the globe coupled with high and volatile price impacted jewellery buying in key markets, but resilient spending on gold jewellery indicates the strength of underlying demand, indicated by strong buying when the market offered attractive price points.

“These figures confirm that investors around the world recognise the benefits of holding gold during this time of unprecedented global financial crisis, recession and the spectre of future inflation,” said Aram Shishmanian, the new CEO of the World Gold Council.

“Gold has a gain proven its core investment qualities as a store of value, safe haven and portfolio diversifier and this has struck a chord with nervous investors. Whilst current market conditions have impacted consumer spending on jewellery, purchasers in many of the key gold markets understand gold’s intrinsic investment value and continue to buy.

“The economic downturn and uncertainty in the global markets, that has affected us all, is unlikely to abate in the short term. Consequently, I anticipate that gold as a unique asset class will continue to play a vital role in providing stability to both household and pro

Tags: UAE | Dubai | Gold | Jewellery Sales | Gold council |

calendarCalendar of Events