Saudi Gazette

JEDDAH — Despite a steep fall in gold prices, there is no corresponding rise in the demand for the yellow metal in the Kingdom. Gold prices have been on the downward trend for weeks now touching lowest levels in two years.

Earlier whenever gold prices went down, the bullion markets in the Kingdom used to be full of customers to strike a good bargain. But, this time the markets are dull.

There are also indications that the prices could further fall, but customers are nowhere to be found.

Some of leading traders are sending SMS to their clientele informing them about the decline in price of precious metal and also offering incentives.

Asian expatriates and visiting Haj and Umrah pilgrims are prime segments of gold clientele in the Kingdom and elsewhere in the Gulf region.

However, gold merchants in Balad and Kandra in Jeddah said shops were flooded with pilgrims immediately after the Haj. But, they said, the trend did not last long. Customers completely disappeared within two-three days, they said.

For many designed jewelry retails shops it is not pilgrims but regular Asian expatriates living in the Kingdom who are their principal buyers. According to retailers after dependent fees was levied on the expatriate worker gold sales have been declining.

On Sunday, the price of 24 carat gold in the Kingdom was SR154 per gram and SR141 for 22 carat gold, much lower than at the end of the month prices.

The relatively lower prices, however, many not stick around for long, with the forecast for days ahead now favoring the precious metal especially Deepawali (a Hindu festival in India) season.

It is interesting to note that many customers are not enjoying the spirit of price fall as merchants are charging extra money for the design and make of jewelry. This trend has left many customers confused.

Prices of Chandan of India and Singapore designs are higher compared with others.