Gold merchants across the country are braced for the busiest trading day of the year so far as sales of jewellery and bullion are expected to be given a double boost from today's Hindu festival of Akshaya Tritiya and a persistent bear market.
"There is a dramatic appetite for gold today. The Indian festival is important and also because of the price dropping," said Tarek El Mdaka, the managing director of Kaloti Gold in Dubai.
Dubai has benefited from a renewed buyers' market in gold since the price plunged more than 20 per cent last month.
Investment funds that had hoarded the yellow metal since the start of the financial crisis sold off hundreds of tonnes in a matter of hours, sending prices through the floor.
Gold rose from less than US$850 a troy ounce in 2008 to more than $1,920 at its peak last September. After last month's sell-off, the price has been stuck in the low $1,400s and was last night at $1,436.55 an ounce.
The reduced price has ushered in a new wave of small-time investors with Indian and Chinese buyers coming to the fore.
"The 22-carat market is very strong on festivals like Akshaya Tritiya," said Kiran Pithani, the owner of Cara Jewellery in the Dubai Gold and Diamond Park.
"Indian buyers are crazy for 22-carat gold for these festivals. Akshaya Indians have to buy gold, it is good luck. When the price is as low as this they buy more. It's as simple as that."
Traditionally Hindus and Jains buy gold jewellery or trinkets made from the precious metal as gifts for festivals such as Ashkaya Tritiya in spring and Diwali in November.
This year, however, sales in the UAE are focused on small coins and ingots known as wafers or biscuits instead.
"Indians are buying less jewellery and more biscuits this year. Anything below $5,000 apiece is what we are seeing. There is very strong demand for these products," Mr El Mdaka said.
He added that sales of such small investment grade ingots and coins were given an extra boost this year as India has increased taxes on gold imports in an effort to exert tighter control on monetary policy.
"So there is a great arbitrage to be done here. If you buy in Dubai and travel to India with a couple of small coins or biscuits for your personal use you are making a couple of hundred dollars given the 6 per cent tax. Enough to pay for your flight. That is one reason why these products are so popular."
jdoran@thenational.ae
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Building boom turning to bust as Turkey's economy slows
Deep in a provincial region of northwestern Turkey, it looks like a mirage - hundreds of luxury houses built in neat rows, their pointed towers somewhere between French chateau and Disney castle.
Meant to provide luxurious accommodations for foreign buyers, the houses are however standing empty in what is anything but a fairytale for their investors.
The ambitious development has been hit by regional turmoil as well as the slump in the Turkish construction industry - a key sector - as the country's economy heads towards what could be a hard landing in an intensifying downturn.
After a long period of solid growth, Turkey's economy contracted 1.1 per cent in the third quarter, and many economists expect it will enter into recession this year.
The country has been hit by high inflation and a currency crisis in August. The lira lost 28 per cent of its value against the dollar in 2018 and markets are still unconvinced by the readiness of the government under President Recep Tayyip Erdogan to tackle underlying economic issues.
The villas close to the town centre of Mudurnu in the Bolu region are intended to resemble European architecture and are part of the Sarot Group's Burj Al Babas project.
But the development of 732 villas and a shopping centre - which began in 2014 - is now in limbo as Sarot Group has sought bankruptcy protection.
It is one of hundreds of Turkish companies that have done so as they seek cover from creditors and to restructure their debts.
If you go
Flight connections to Ulaanbaatar are available through a variety of hubs, including Seoul and Beijing, with airlines including Mongolian Airlines and Korean Air. While some nationalities, such as Americans, don’t need a tourist visa for Mongolia, others, including UAE citizens, can obtain a visa on arrival, while others including UK citizens, need to obtain a visa in advance. Contact the Mongolian Embassy in the UAE for more information.
Nomadic Road offers expedition-style trips to Mongolia in January and August, and other destinations during most other months. Its nine-day August 2020 Mongolia trip will cost from $5,250 per person based on two sharing, including airport transfers, two nights’ hotel accommodation in Ulaanbaatar, vehicle rental, fuel, third party vehicle liability insurance, the services of a guide and support team, accommodation, food and entrance fees; nomadicroad.com
A fully guided three-day, two-night itinerary at Three Camel Lodge costs from $2,420 per person based on two sharing, including airport transfers, accommodation, meals and excursions including the Yol Valley and Flaming Cliffs. A return internal flight from Ulaanbaatar to Dalanzadgad costs $300 per person and the flight takes 90 minutes each way; threecamellodge.com
