Global Arab Network | Kuwait gold sales decline, prices reach records

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Kuwait gold sales decline, prices reach records

Global Arab Network - - George Haddad

Thursday, 30 September 2010 01:01

Gold sales in Kuwait have been in a slump since the world economic crisis broke out in mid 2008 with the prices going beyond the purchasing power of the majority of consumers.

However, the prices keep going up and are poised to hit new record highs, Ibrahim Lari, a gold seller, said Wednesday as he looked desperately at customers going to other more booming businesses.

Since early September, the gold price in Kuwait has made up to ten new all-time highs, hitting KD 12,000 per kilogram, or KD 12 a gram. A Kuwaiti dinar equals some 3.50 US dollars. The rally, triggered by the global economic crisis, is not over yet, as the factors pushing the prices up are still there, observers believe.

Foremost among these factors are the tendency of investors to invest in the gold industry after they lost confidence in the stock markets and the fluctuating exchange rates of main currencies.

"Investors consider gold more secure domain of investment than other businesses," Deputy Chairman of Kuwaiti Gold Merchants Union Nasser Al-Sayegh said in statements to KUNA.

"This fuelled demand on gold, thus pushing the prices up. Contrary to what many people believe, the upward trend of gold prices has negative impacts on the merchants," he argued.

"Most customers were forced to shun buying gold and tended to other cheaper accessories that match their purchasing power," Al-Sayegh explained.

"Kuwait imported only 12 tons of gold in 2009 compared to 26 tons in 2006 and a similar quantity in 2007.

"The shortage of imports forced many gold jewelry making workshops to shut down," he noted, attributing the debacle to the global financial crisis.

Al-Sayegh predicted the upward trend of the prices to persist and the price to hit KD 13,000 a kg by the end of 2010.
(KUNA)

Global Arab Network

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Last Updated on Thursday, 30 September 2010 01:03

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