UAE sees drop in gold jewellery demand due to high prices, India's import duty cuts
Gold jewellery demand fell 14 per cent in the UAE in the fourth quarter of 2024 due to high prices and India's decision to cut import duty on gold from 15 per cent to 6 per cent.
The World Gold Council data showed jewellery demand falling to 8.8 tonnes in the fourth quarter of last year, down from 10.3 tonnes in the same quarter of the previous year.
Demand for bars and coins bucked the trend as demand grew from 3.1 to 3.4 tonnes during the comparative period as investors cashed in on the rising prices of the yellow metal.
Precious metal prices have been increasing consistently over the past few quarters due to strong demand from central banks, a drop in interest rates, and concerns about US President Donald Trump's policies around tariffs.
Gold reached a record high of $2,854 per ounce on Wednesday. In Dubai, prices also reached an all-time high with 24K and 22K trading at Dh344 and Dh320.25 per gram, respectively, at the opening of the markets on Wednesday.
Overall, demand for gold from consumers fell eight per cent from 13.3 tonnes in Q4 2024 to 12.2 tonnes in Q4 2025.
Per-capita consumer demand in the UAE fell to 4.36g in 2024 compared to 4.8g in 2023 and 5.38 in 2023.
Anuraag Sinha, managing director of Liali Jewellery, said gold jewellery sales have seen a decline due to record-high prices.
'For example, global gold jewellery consumption dropped by 11 per cent in 2024, with markets like India and China experiencing a decrease of six per cent and 27 per cent, respectively. However, we are more focused on diamonds; this trend likely hasn't had a significant impact on your business,' said Sinha.
'$3,000 looks like an easy target'
Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said investors may look more relaxed now than they did at the start of the week, but havens continue to see increased demand on the back of growing global uncertainties under Trump's lead.
'There is not a better hedge than gold for protecting a portfolio from Trump worries: the more chaotic international relations become, the greater the demand — especially from central banks looking to reduce US exposure should Trump turn his focus on them. As a result, gold hit a record high for the fourth straight session, reaching $2,860 per ounce in Asia for the first time. At this pace, Trump makes $3,000 look like an easy target,' said Ozkardeskaya.
World Gold Council said global gold jewellery consumption fell 11 per cent, hit by record high prices, while full-year bar and coin demand held firm at 2023 levels.
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