Gold Prices Fall; Shoppers Lock-In for Festivals in UAE

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Many UAE gold and jewelry shoppers have embraced the “lock-in” option in anticipation of the Dhantera and Diwali festivals, with some jewelers reporting a significant increase of up to 200% compared to the previous year.

This surge in interest can be attributed to the recent drop in precious metal prices, which hit seven-month lows. However, these prices have rebounded due to increased demand for safe-haven commodities prompted by the Middle East conflict.

The Indian festivals of Dhantera and Diwali, occurring in the second week of November, hold special significance for buying precious metals and jewelry. Many Indians consider purchasing gold during the Dhantera festival to be auspicious.

When shoppers choose the ‘lock-in’ option, they typically pay an upfront amount, often around 10%, to secure the current gold rate. If the gold price rises, they can purchase at the locked-in rate. If it falls below that rate, they can take advantage of the lower price. This guaranteed benefit is driving more customers to opt for gold rate protection.

Ramesh Kalyanaraman, executive director of Kalyan Jewellers, noted the increase in shoppers selecting the ‘lock-in’ option ahead of these festive occasions, stating that it has become an annual tradition for their patrons.

John Paul Alukkas, managing director of Joyalukkas Group, also confirmed the rise in customers choosing the ‘lock-in’ option in the UAE, with a noticeable increase in the percentage of those opting for this approach.

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