Despite gold prices reaching record highs 40 times this year, shoppers in the UAE have not been deterred. Retailers report that while purchasing habits have evolved, the fundamental demand for gold remains robust, driven by cultural traditions, its value as an investment, and the approach of the festive season.
Jewellery stores continue to see steady footfall, even as prices test new limits on a near-weekly basis. The primary change, according to industry insiders, is not if customers buy, but how they buy.
Shifting Consumer Habits
Shoppers are adapting to the higher costs by adjusting their selections rather than their budgets. They are opting for smaller, lighter pieces to stay within their intended spending limits.
“If people used to buy jewellery for Dh10,000 last year, they are also spending Dh10,000 now, but they will be getting much lesser weight compared to last year,” said Arjun Dhanak, Director at Kanz Jewels. He noted that with Diwali approaching, demand for gifts remains strong, though buyers are choosing more delicate items.
This trend reflects a practical response to the market, allowing consumers to continue participating in cultural gift-giving traditions without overextending their finances.
The Rise of Lightweight Designs
The preference for less weighty jewellery has become more pronounced, with intricate but lightweight designs gaining popularity. These pieces offer a comparable aesthetic to heavier, more traditional items but at a more accessible price point.
“The Italian designs that come in as little as half a gram to five grams can give you the same look and feel,” explained Viraj Shah, General Manager at Bafleh Jewellery. “So lightweight is definitely for the next generation.” This shift indicates a growing market for modern, minimalist styles that appeal to younger buyers.
Even with gold prices hovering near historic peaks, the local market’s depth ensures consistent demand. While the weight of gold being carried out of stores may have decreased, for many buyers in the UAE, the sentiment and sparkle remain as strong as ever.
