Market sources worry that if the global market situation changes, it could even push the rate to Dh180 or over. For the record, the highest Dubai gold rate was Dh204 a gram in 2011.
Cyriac Varghese, the General Manager at Sky Jewellery expresses:
“Jewellery retailers can waive off making charges, offer gold exchange schemes and free coins — but when there is a more than Dh10 a gram difference between July and August, no one can waive that off…The third quarter is typically the lowest point for gold buying… but this year, it has dropped by a further 15 per cent or so.”
In August 2018, the gold rate was in the range of Dh140 per gram and the demand was reasonable. “From then to now, the decline would be in the 20-25 per cent range,” according to a Member of the Dubai Gold and Jewellery Group, Salam.
It’s a make or break week for shoppers of gold, as they will need to make a decision whether they are willing to commit. The situation stems on what Jerome Powell of the Chief of US Federal Reserve will have to say at the annual bankers’ summit. If Powell signals US interest rate cuts, gold will be in for another ride.
When that happens, international bullion prices will be pulled to $1,600-$1,650 an ounce, and at those levels, local rates would cross Dh180 a gram.
To serve as a reminder, in 2011, the bullion was at $1,923 an ounce when Dubai’s gold rate was Dh204 a gram.