Gold jewellery shoppers in Dubai and the UAE are increasingly opting for the more affordable 18K variant over the traditionally popular but costlier 22K due to the unprecedented surge in precious metal prices. Industry experts note that the rising prices of yellow metal are also driving up demand for diamond-studded jewellery. In Dubai, gold prices hit a historic peak on October 23, with the 24K variant reaching Dh333 per gram and 22K soaring to Dh308.25 per gram. The 21K and 18K variants also saw record highs at Dh298.5 and Dh255.75 per gram, respectively. By Monday evening, these prices had slightly adjusted to Dh331.75, Dh307.25, Dh297.5, and Dh255 per gram for 24K, 22K, 21K, and 18K, respectively.

22K gold jewellery remains the most sought-after and expensive in Dubai, particularly among Asian shoppers, due to its higher purity. However, the skyrocketing gold prices are significantly altering consumer preferences and market trends in Dubai and the UAE. As previously reported by Khaleej Times, shoppers are now leaning towards smaller pieces of jewellery for affordability reasons, and manufacturers are responding by producing more budget-friendly options. With the upcoming Indian festivals of Diwali and Dhanteras, the Dubai Gold Souk is experiencing a surge in footfall as buyers take advantage of the discounts and offers from over 300 retailers.

“The Dubai Gold Souk – The Extension is seeing a significant influx of both local and international customers ahead of high-demand occasions like Diwali and Dhanteras. These festive periods are crucial in reinforcing the Dubai Gold Souk – The Extension’s position as a global leader in gold trading, solidifying its reputation as the go-to destination for gold and fine jewellery year-round,” stated Rashid Al Harmoodi, Senior Director for Property Management at Ithra Dubai.

Anuraag Sinha, Managing Director of Liali Jewellery, highlighted that the escalating gold prices have indeed boosted demand for 18K jewellery, which offers a more affordable alternative to 22K or 24K options. “During periods of high gold prices, 18K jewellery becomes more attractive due to its affordability, durability, design versatility, and stylish appeal, even if it sacrifices some purity. This shift in demand towards 18K balances style and affordability, catering to customer needs in a high-gold-price environment,” he explained.

Chirag Vora, Managing Director of Bafleh Jewellery, noted that while there is a 15 to 18 percent difference in gold prices between 18K and 22K, the making charges for 18K are significantly higher. “However, some 18K collections are notably lighter than their 22K counterparts, making them a preferred choice for some customers,” Vora added.

Afzal Arakkal, Director of Arakkal Gold and Diamonds, echoed similar sentiments, stating that the demand for 18K jewellery is growing due to its appealing mix of affordability, substantial gold content (75 percent), and luxurious look. “Overall, 18K gold has emerged as a cost-effective choice for those seeking quality and durability in their jewellery, especially in times of rising gold prices,” he said.

Arakkal also observed a trend of UAE shoppers shifting from gold to diamond jewellery, particularly as gold prices continue to rise. “Diamonds represent a significant investment and offer a variety of styles, often serving as status symbols. As consumers look for alternatives to high-priced gold pieces, diamonds are becoming more attractive, especially in fine jewellery collections. This shift reflects evolving consumer preferences and market dynamics,” he explained.

Chirag Vora of Bafleh Jewellery added that there is a growing demand for small sets of diamond jewellery, pendants, and jewellery featuring colored gemstones like emeralds, rubies, and other precious stones. “This trend is not just driven by price but also by the unique designs these pieces offer,” he noted.

Anuraag Sinha of Liali Jewellery further emphasized that diamond jewellery is highly popular for gifting, symbolizing elegance and prestige, which has increased its appeal during special occasions and festivals like Diwali, despite the rise in gold prices. “Overall, while gold jewellery remains significant, the recent price hikes have encouraged some UAE shoppers to explore diamond jewellery as a fashionable and economically viable alternative,” he concluded.

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