UAE's August gold sales down 15pc in Ramadan
Dubai, September 2, 2010
Retail gold demand volumes in Dubai and Abu Dhabi dipped by around 15 per cent in August on the year, as the holy month of Ramadan led consumers to focus more on food purchases, traders said on Thursday.
'Ramadan is all about food and not about buying jewellery that's why we saw a dip of around 15 per cent in August,' said a jewellery trader at Mansuk Jewellers in Dubai's old gold souk.
The holy month of Ramadan, where Muslims fast from sunrise to sunset started on 11 August and is expected to end on 10 September depending on the lunar calendar.
'Last year we had Ramadan start closer to the end of August and that is also why the sales are lower on the year,' said Tushar Patni, director of Ajanta Jewellers, one of the largest retailers in the emirate capital of Abu Dhabi.
Retail sales represent the bulk of gold demand in the Gulf region because the investment market is in its infancy. There are no official monthly figures in the United Arab Emirates, and views gathered by Reuters are anecdotal from traders at the gold souks.
Spot gold gained $2.8, or 0.2 per cent, to $1,246.30 an ounce on Thursday, after a two-month high of $1,254.65 on Wednesday, which is just $10 below the all-time high.
Traders are expecting sales to accelerate during the first two weeks following Ramadan, said Pradeep Unni, senior analyst and trader at Richcomm Global Services in Dubai.
'This pick up in demand will more than make up for the losses encountered over the past weeks,' he said.
Overall, retail gold demand volume in the Middle East during the second quarter of the year was mixed, with Saudi recording a 5 per cent rise on the year, while the UAE fell by 15 per cent, according to a report by the World Gold Council (WGC).
Gold demand in Saudi was driven by strong domestic consumption, and UAE demand had tailed off in response to high prices during the second quarter, the WGC report added.
Other Gulf countries saw demand drop by 25 per cent in the second-quarter this year compared to the same time a year earlier, the report said. – Reuters