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Abu Dhabi Gold Jewellery 
Sales Slide 70pc in January

A quick recovery in jewellery sales looked unlikely, said Tushar Patni, the chairman of Abu Dhabi Gold and Jewellery Group. Investors buying gold bullion as a safe haven during the downturn are supporting international prices and making the metal less attractive for retail consumers with shrinking disposable income, Patni said.

“Sales are poor, down to 70 per cent in volume in January, it is the lowest sales since early 2008,” Patni said. “The prices are high, there are no festivals or occasions and the liquidity crisis ... these are the main reasons for such bad sales.” Some Asians, traditionally big gold buyers, have left the city after job losses and others have become more cautious due to the generally gloomy market conditions, Patni said.

Demand for gold bars was also down around 50 per cent, he added. Patni saw little sign of traders offering promotions to breathe new life into the market. “It is a waste of money, nothing can help the market,” he said. Prices in January averaged around 100 dirhams ($27.20) a gram, up about 1 per cent from December, he said. Spot gold XAU in London ended January at around $928.50 an ounce on Friday, up over $50 from the end of December. Tax-free jewellery in the United Arab Emirates’ gold souks and shopping malls draws Gulf Arab, Asian and Western tourists.