Gold loses lustre as Mideast sales slump

GOLD JEWELLERY: Losing its lustre in Mideast - for now. (Getty Images)

Joy Alukkas, Chairman of Joyalukkas Group, a major India-based gold and diamond retail chain, said in an interview published Saturday that high gold prices and extreme price volatility are hitting company sales in the Middle East at present.

Talking to CommodityOnline he said sales will only begin to rise again in the Gulf once the price of gold itself stabilises. In the last three months gold prices have been ranging between $800 and $1,000 an ounce.

The company estimates that gold sales in the UAE, Bahrain and Qatar have plunged by at least 60% in the first three months of 2009.

As a result, the chain, which has 40 branches across the globe and had been opening 12 outlets a year since its inception in 1998, has now halted all expansion plans for the coming year.

"We want to consolidate in the next 12 months. We have committed to five store openings in the UAE, Bahrain, Qatar and India. We will not launch any more stores until this crisis is over and market confidence and spending returns,'' Allukas said.

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