DUBAI(Reuters) – Abu Dhabi’s gold industry sales fell 40 percent year-on-year in February as high prices dampened demand, Tushar Patni, the chairman of the emirate’s Gold and Jewellery Group, said on Saturday.
“Abu Dhabi’s gold sales continued to drop in February as gold prices remained higher for the buyers,” Patni told Reuters.
“We also did not have any festival or a special occasion for people to come and buy gold at the current price,” the industry association’s chief said in a telephone interview.
Gold sales in Abu Dhabi, one of seven emirates that make up the United Arab Emirates, dropped 35 percent in January. But sales of Dubai’s gold industry sales rose 40 percent in the same period, boosted by growing tourism and the Dubai shopping festival which began in December and ended on Feb. 2.
Spot gold hit its highest level in nine months on Feb. 26 as a weak dollar and growing tensions between Iran and the United Nations prompted investors to buy the metal. It fell below $660 ounce for the first time since Feb. 21 on Friday.
Patni said first quarter sales depended heavily on prices.
“If the current (downward) trend continues then gold sales for the first quarter will drop by around 35 percent, but if gold goes up again we could see a 50 percent drop,” he said.
Visitors from oil-rich states such as Saudi Arabia flock to gold souks and malls in the UAE to buy brands such as Tiffany, Cartier and Chopard, and Italian designer jewellery including Pasquale Bruni and Roberto Coin.
Both Abu Dhabi and Dubai have their own jewellery manufacturers, but imports make up almost 60 percent of all jewellery sold at retail outlets.