Gold Demand in UAE Adapts Amid New Record High Prices

Despite gold prices hitting record highs for the second time this year, demand in the UAE remains resilient, with consumers adapting their buying habits rather than stepping away from the market, according to local jewellers and industry experts.

When markets opened on Monday, 24-carat gold was priced at Dh539.75 per gram, after previously reaching Dh525.25 on October 21 before dipping and rebounding. Prices for other categories stood at Dh490.75 for 22K, Dh470.50 for 21K, Dh403.25 for 18K and Dh314.50 for 14K gold.

Globally, spot gold climbed to $4,401.05 by 10.30am, up 1.4 per cent from Sunday. Silver also surged, rising 2.7 per cent earlier in the day to a historic high of $69.23, before settling at $69.02.

Buying habits evolve, demand holds firm

Industry insiders say high prices have not discouraged buyers, but have reshaped purchasing behaviour.

“High prices haven’t stopped demand — they’ve changed how people buy,” said Ahmed Abdeltawab, CEO and co-founder of fractional gold purchase app O Gold. “Users prefer fractional purchases and regular accumulation rather than large lump-sum buys.”

Jewellers are seeing similar trends on the retail side. “Buyers are choosing lighter pieces,” said Amina Mohamad Ali, director of MFar Jewellers. “Diamond jewelry has also seen an increase in demand. The high gold prices have not really deterred people from buying. There has been an anticipation of the increase in prices, so customers have made purchase decisions independent of that.”

New investors enter the market

Rising prices are also drawing in first-time and younger investors, according to Abdeltawab.

“Record highs are attracting new and younger investors, with many starting with small amounts. Education, accessibility, and fractional buying are key drivers bringing first-timers into the market now,” he said.

He added that gold continues to be viewed as a long-term hedge in the UAE. “In the UAE, gold is still viewed as a store of value and hedge, especially during global uncertainty. Short-term trading increases during sharp price moves, but accumulation remains dominant.”

Global factors behind the rally

Market analysts point to a combination of global factors driving gold’s strong performance.

“At the global level, macro uncertainty around growth prospects, geopolitics and ongoing fiscal issues have increased gold demand for managing portfolios effectively,” said Ahmad Assiri, Research Strategist at Pepperstone. “Central bank demand is one dominant anchor for the gold market, overtaking rate expectations factor. All these factors made gold the highest performing major asset this year.”

Assiri noted that while many did not expect fresh highs in 2025, the rally reflects deeper market dynamics rather than speculation.

“Volatility has been a defining feature of gold this year, but the underlying trend has remained constructive,” he said, adding that the recent surge appears driven by long-term positioning as investors increasingly view gold as a core portfolio holding heading into the new year.