Manufacturers in the UAE are turning towards producing more lightweight gold jewellery as demand for lightweight yellow metal ornaments has increased. This shift in consumer preference is mainly due to the prices of gold hitting all-time highs in Dubai. Industry executives have noted that jewellery pieces below 15 grams are in high demand as shoppers are not willing to stretch their budgets to buy heavier gold jewellery. The record-high prices of gold have impacted sales as investment buyers, especially Asians, are currently holding back on making purchases.
Gold prices have been rallying for the past few months, reaching an all-time high of Dh322.75 per gram in Dubai. This trend is driven by expectations of further interest rate cuts, geopolitical tension in the Middle East, and the revival of funds inflows into exchange-traded funds. The increase in gold prices has led to a significant drop in sales, with some businesses experiencing a 10-15 per cent decrease in revenue. Manufacturers and retailers are adapting to the changing market dynamics by focusing on producing lighter weight jewellery designs to cater to consumer demands.
Tawfique Abdullah, chairman of Jawhara Jewellery, highlighted the impact of rising gold prices on the jewellery industry, noting a shift towards lighter weight jewellery compared to a decade ago. He emphasized the importance of manufacturers adapting to the changing market conditions to meet consumer preferences. John Paul Alukkas, managing director of Joyalukkas Group, echoed similar sentiments, mentioning a surge in demand for lightweight gold jewellery in the UAE. Manufacturers are now focusing on creating intricate designs using less gold while maintaining premium quality to offer affordable options to customers.
Alukkas mentioned that pieces in the 5 to 15-gram range are particularly popular among buyers seeking a balance between style, affordability, and sophistication. This weight range allows customers to enjoy the elegance of gold without the financial commitment of heavier pieces. Shamlal Ahamed, managing director for international operations at Malabar Gold and Diamonds, stated that despite the impact of record-high gold prices on demand, gold continues to be a value-appreciating asset. To assist customers during the festive season, Malabar Gold and Diamonds have introduced an offer where customers can pay a 10 per cent advance to secure current gold prices.
In conclusion, the demand for lightweight gold jewellery is on the rise in the UAE as consumers seek more affordable options amidst soaring gold prices. Manufacturers and retailers are adapting to market trends by focusing on creating intricate designs using less gold, particularly in the 5 to 15-gram range. Despite the challenges posed by record-high gold prices, the industry remains resilient, offering customers innovative solutions to access beautifully crafted pieces at competitive prices. By understanding and responding to changing consumer preferences, businesses in the UAE’s jewellery industry are poised to thrive in the evolving market landscape.
