Dubai gold buyers are increasingly choosing bullion over jewellery as frequent price fluctuations reduce jewellery’s investment appeal, prompting a shift toward bars and coins for stability.
Dubai gold buyers favor bullion as jewellery loses appeal amid price fluctuations
Investors and consumers in the UAE are known for their cautious and calculated approach, and sharp movements in gold prices have not discouraged them from participating in the market. Instead, many buyers view price dips as strategic entry points, according to jewellers across the country. When volatility rises, seasoned investors often increase purchases of gold bars and coins, driven by expectations that prices will continue climbing over the longer term.
Last month, gold prices in the UAE dropped by more than Dh20 per gram in a single trading session. This decline followed a fall in global gold rates, as investors locked in profits after a strong rally earlier in the month. Despite such corrections, gold prices have repeatedly touched record highs over the past few months, underlining the metal’s volatile but upward-trending nature.
The strong performance of gold has rewarded those who invested earlier. In 2025, investors in Dubai who purchased gold bars and coins toward the end of 2024 have seen the value of their holdings rise by nearly two-thirds within a year. This marks one of the strongest annual performances for gold in recent history, reinforcing its appeal as a safe-haven and long-term investment.
Tawhid Abdulla, chairman of the Dubai Jewellery Group, noted that consistently rising prices have changed consumer behavior. Buyers are becoming more deliberate and focused on value rather than making spontaneous purchases. “With frequent price movements, customers are spending more time evaluating factors such as purity, pricing structure, resale potential and long-term usefulness before committing,” he explained.
While demand remains steady, purchasing patterns have shifted. Many customers are buying smaller quantities or adjusting the weight of their purchases to stay within budget. Others are carefully timing their purchases or opting for products that offer better investment value. According to Abdulla, overall volumes may be lower, but interest in gold as an investment remains resilient.
Jewellery buying, particularly for adornment, has softened compared to previous periods, while investment-related demand has stayed relatively strong. Bars and coins continue to attract attention from investors seeking liquidity, transparency and long-term gains. This shift reflects a broader trend in the UAE gold market, where informed buyers are adapting to changing price conditions rather than stepping away.
Despite ongoing volatility, confidence in gold remains intact. For many UAE investors, short-term price swings are viewed not as a risk, but as an opportunity to strengthen their positions in a market they continue to trust.
Impact on footfall
John Paul Alukkas, Managing Director for International Operations at Joyalukkas, explained that gold buyers in the UAE — especially in Dubai — tend to be highly knowledgeable and mature in their approach to the market.
He pointed out that regular price fluctuations, whether daily or weekly, are widely accepted and understood as a normal feature of gold trading rather than something unusual. Unlike many Western markets, such volatility does not necessarily reduce customer visits or dampen buying interest.
According to him, a fall in prices is often welcomed as a chance to make planned purchases for occasions like weddings or festivals, while rising prices further strengthen confidence in gold’s long-term worth. He emphasized that purchasing decisions are mainly driven by the purpose — whether cultural, celebratory, or investment-related — which often outweighs short-term price changes. This behavior reflects a market that is both well-informed and resilient.
Jewellery Vs Coins, Bars
Chirag Vora, Managing Director of Bafleh Jewellers, said that customers in the region have a strong awareness of pricing and closely follow international gold market movements rather than focusing only on in-store rates.
He noted that buyers generally fall into two categories: those who carefully track prices and choose to purchase when rates soften, and others who act swiftly during upward trends to avoid paying more later. He added that an increasing number of shoppers prefer to spread their purchases over time, making smaller and more frequent buys to manage price fluctuations instead of relying on a single large transaction.
Most gold shoppers are tourists
Anil Dhanak, Managing Director of Kanz Jewels, said that the vast majority of gold buyers — around 90 to 95 per cent — are tourists visiting from various countries.
He explained that these shoppers are in Dubai for a limited time and therefore cannot afford to delay their purchases in anticipation of more favorable prices. Their main goal is to buy gold during their stay, regardless of short-term market fluctuations, particularly because Dubai is known for offering attractive designs, lower making charges, and better overall value than many international markets. In contrast, he noted that local residents are generally more cautious, closely monitoring price movements and often waiting for a dip. However, he pointed out that this approach can sometimes backfire, as gold prices have consistently trended higher over the long run.
Volatility is the new norm
Shamlal Ahamed, Managing Director – International Operations at Malabar Gold and Diamonds, noted that buyers have largely adjusted to existing gold price levels and now view periodic market movements as part of the norm. He explained that although a small group of highly price-conscious customers may postpone purchases while waiting for short-term price dips, overall showroom performance continues to be strong. This trend reflects widespread consumer acceptance of current gold prices as a stable benchmark. Driven by gold’s dual appeal as an ornament and a reliable investment, jewellery remains the strongest-performing and fastest-selling segment across the company’s retail outlets.
