DUBAI (Commodity Online): Even as reports of world’s gold consumer major India’s imports dropping by almost 60 per cent, same reasons of higher prices and low buyer turnout have resulted in a huge slump in Abu Dhabi’s gold retail sales in August.

According to reports, gold sales dropped by 40 per cent in the month of August in Abu Dhabi.

Prices of the yellow metal have been boosted by institutional funds seeking a safe haven for their assets during the global economic crisis.

The average price of 22 carat gold last month was 107 UAE dirhams ($29.15) a gram compared with 82 dirhams in August last year and 105 dirhams in July this year.

Gold prices were also higher and usually during Ramzan shops witness less sales.

The average price of gold in August last year was 82 dirhams per gram.

Expatriates who comprise the majority population in Abu Dhabi go on annual holiday in July and August.

Sales are expected to be flat this month if prices continue to be on the high side. Price of gold touched 110 dirhams a gram this week. Spot gold has risen by more than a quarter to about $980 an ounce from a low of $773.90 in August last year. In October it dipped to a one-year low of $680.80.

Retail gold prices move in line with spot prices that have eased slightly this year as investors switched from gold to equities due to the recovery in stock markets.

Abu Dhabi has some 85 gold shops and its own jewellery manufacturers. Imports, however, make up almost 60pc of all jewellery sold at retail outlets.

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