Consumer trends: Rising gold prices fail to deter UAE jewellery buyers

Jewellery sales have experienced a notable uptick in the UAE despite the bullish trend in gold prices as the buyers and investors pose unwavering trust in yellow metal, which has long been recognised as a safe haven during economic uncertainty, leading to heightened demand among consumers seeking long-term investment opportunities.

In addition to traditional high-carat gold jewellery, there has been a marked rise in the sales of low carat jewellery, diamonds, and gemstones as the consumers are increasingly drawn to these options due to their affordability and aesthetic appeal. Low carat gold pieces, often more accessible for everyday wear, have become particularly popular among younger demographics who appreciate both style and investment potential, according to the experts.

Simultaneously, the market for diamonds and gemstones is flourishing, with consumers valuing the unique characteristics and inherent beauty of these materials. This trend reflects a broader shift in consumer behaviour, where individuals are not just purchasing jewellery for adornment but as an investment strategy in volatile times. As confidence in the stability of gold continues, the jewellery sector is poised for sustained growth, driven by the dual motivations of personal luxury and financial security.

Over the medium term, opportunities for gold remain as the tightening cycle approaches its final stage, while geopolitical risks persist. Gold is undergoing a healthy correction within a fundamentally favourable medium-term trend and investors should remain cautious, awaiting upcoming data and policy signals to adjust their strategies accordingly.

Complex, Ambiguous Scene

Daniela Sabin Hathorn, Senior Market Analyst at Capital.com, said the $3,450–$3,400 zone continues to act as a cap on the upside, while buyers have stepped in near $3,330, reinforcing support. A confirmed break and hold above key resistance at $3,405 for an ounce would be needed to signal renewed bullish conviction.

From a macro perspective, she said gold is caught in a tug-of-war. On one side, weaker US dollar dynamics and signs of easing inflation create a backdrop conducive to higher gold prices.

“Realistically, you’ve got a reason to be a seller if you want, but a much stronger reason to be a buyer. There is just a lot going on. This indecision is playing out in the charts, where the market lacks a clear directional bias and is awaiting a catalyst.”

Rania Gule, Senior Market Analyst at XS.com – Mena, said gold is currently experiencing sharp fluctuations between supportive and restrictive factors, placing investors in front of a complex and ambiguous scene.

“Overall, I see gold currently caught between the Fed’s hammer and geopolitical optimism’s anvil. The supportive factors for an upside move exist but are not decisive, while the downward pressures are present but not sufficient to break support levels. Thus, the most likely scenario is that the metal will remain trapped in a range between $3,300 and $3,400 per ounce in the near term, with a slight downside bias if the dollar continues to benefit from inflation data. However, any unexpected signal from Jackson Hole — or a setback in peace efforts between Russia and Ukraine — could dramatically change the picture and reignite gold’s appeal as a haven.”

 Shamlal Ahamed, Managing Director for International Operations at Malabar Gold and Diamonds, said the recent price rally of yellow metal rally has a limited impact on jewellery sales. 

“With gold prices historically on an upward trajectory, its status as a value-appreciating, consumable asset remains strong. Consequently, the recent price surge in global markets has had only a limited impact on our sales,” Ahamed told BTR.

Shamlal Ahamed, Managing Director for International Operations at Malabar Gold and Diamonds.

“While price-conscious consumers may adopt a wait-and-watch approach until rates stabilise, we have observed a significant shift in preference toward lightweight jewellery. This trend is driven not just by affordability, but by the growing appeal of sleek, versatile designs that can be worn daily yet remain elegant enough for special occasions,” he said.

At the same time, he said demand for diamond jewellery continues to rise, as more customers aspire to experience the exclusivity and sophistication these stones represent.

“While further fluctuations in gold prices may temporarily accelerate demand for lightweight and lower-carat products, we believe this shift will normalise as customers adapt to new price points,” Ahamed said.

Moreover, he foresees strong growth in sales later this year as the jewellery buyers are expected to explore different options in the market ahead of Diwali, Chrismas and wedding season.    

“With the festive season is approaching — a time traditionally associated with heightened jewellery purchases — we anticipate strong growth in gold sales,” he said.

Stable Jewellery Sales

Ramesh Kalyanaraman, Executive Director, Kalyan Jewellers, said the recent rise in global gold prices has had only a temporary impact on jewellery sales in the UAE.

“Naturally, when prices peak sharply, some customers take a short pause in their purchases. However, demand in this market is resilient, particularly given the cultural and emotional significance of gold,” Kalyanaram told BTR.

“For occasions such as weddings and festive celebrations, customers continue to make their purchases, and very quickly adapt to the new price levels. The UAE remains a strong and stable market for gold jewellery, supported by both tradition and trust,” he said.

Ramesh Kalyanaraman, Executive Director, Kalyan Jewellers

To a question about shift in consumer purchasing behaviour due to price changes, he said: “We are not seeing a fundamental shift in consumer purchasing behaviour. Each time gold prices rise, there is a brief period of adjustment, but very quickly it becomes the ‘new normal’.”

He said customers in the UAE are highly accustomed to fluctuations in the gold market and continue to value gold both as adornment and as an investment. “Cultural traditions, weddings, and gifting occasions remain strong drivers of demand, ensuring purchasing behaviour remains stable over time.”

The Joyalukkas Spokesperson said the UAE has always been a strong and resilient jewellery market and while rising global gold prices have naturally made customers more cautious, sales momentum has remained stable.

“What we’ve observed is that consumers are not turning away from gold, but instead, they are approaching their purchases more strategically.”

Customers are opting for smaller ticket-size purchases, lighter designs or focusing on jewellery that holds long-term investment value. The sentiment is clear — gold remains an attractive store of value, especially in times of volatility.

“At Joyalukkas, our diverse product mix across price points has helped us maintain steady demand, as customers trust us to provide options that meet both, their emotional and financial expectations,” the spokesperson said.

To a question about a shift in consumer purchasing behaviour due to price rally, he said: “Yes, there is a noticeable behavioural shift, but it is more adaptive than negative. Customers are becoming more price-conscious and informed — many are tracking gold rates closely before making a purchase. We’re also seeing a rise in customers who are prioritising investment-led buying — choosing timeless, versatile pieces that can serve both, as adornment and as a financial safeguard.”

On the other hand, he said many younger buyers and gifting customers are leaning towards lighter jewellery collections that balance affordability with style. “This change reflects a more mindful consumer mindset and as a brand, we’ve responded with collections and promotions tailored to suit these evolving preferences.”

Gold is caught in a tug-of-war. On one side, weaker US dollar dynamics and signs of easing inflation create a backdrop conducive to higher gold prices.

Demand for Alternatives

About an increase in demand for lower carat gold jewellery or alternative materials, such as diamonds and other gemstones, Kalyanaram of Kalyan Jewellers said gold buyers in the UAE expressed full faith in yellow metal and are stick to their buying plans.

“With higher gold prices, we have not seen customers in the UAE shifting towards jewellery of lower purity as this market continues to place strong emphasis on quality, with 18K being the minimum standard of preference. What we are observing, however, is growing interest in 18K jewellery that incorporates diamonds or gemstones, particularly among younger customers,” he said.

“There is also a rising trend towards contemporary 18K plain gold designs, often inspired by Italian-style collections, which cater to evolving fashion sensibilities. While purity remains a non-negotiable factor for most buyers, these newer product styles are adding variety and broadening choice for customers,” Kalyanaram added.

The Joyalukkas Spokesperson also noticed that there is an increase in demand for lower carat gold jewellery or alternative materials, such as diamonds and other gemstones due to the recent gold price rally.

“Absolutely, the demand for alternative options has grown stronger. Lower carat gold jewellery, particularly 18K is gaining popularity as it allows customers to enjoy larger statement pieces at more accessible price points.

 “In parallel, we are seeing increased interest in diamonds and gemstone jewellery, especially among younger consumers and gifting segments. Diamonds, in particular, have become a popular choice because they combine the allure of luxury with long-term value. What’s also interesting is the growing preference for combining gold with diamonds or gemstones in contemporary designs — offering both affordability and aesthetic appeal.”

He said this diversification in demand highlights the customer’s desire for choice and Joyalukkas is uniquely positioned to cater to this shift with a wide portfolio that balances tradition with modern preferences.

To a question, he said price fluctuations are likely to make consumers even more discerning, but not less engaged with gold jewellery. “In the UAE, gold especially within the Asian diaspora this precious metal is not only cultural but also financial — so demand is resilient by nature. What we foresee is a stronger tilt towards practical buying, where customers evaluate purchases with a mix of emotional and financial reasoning. They may gravitate more towards multipurpose jewellery — pieces suitable for daily wear, gifting and investment alike.”

Simultaneously, he said the appeal of alternative categories like diamonds and designer collections will grow, as customers seek variety while still valuing security. “We expect demand to remain healthy overall, with preferences shifting towards thoughtful, versatile and high-value pieces rather than impulse-driven purchases.”

 The Joyalukkas Spokesperson said there is no single trend — it’s a layered response. “For traditional buyers and long-term investors, heavier gold jewellery and bars remain a priority, as they view these as safe assets. At the same time, aspirational buyers, especially millennials and Gen Z, are leaning towards diamonds and gemstone-studded jewellery, where the appeal lies in style, individuality and perceived value.”

Parallelly, he said there’s also strong demand for budget-friendly, lightweight collections that make jewellery accessible even in a high-price environment.

“What ties all these preferences together is the customer’s search for value — whether in the form of investment security, luxury appeal or affordability. At Joyalukkas, our strategy is to ensure we have the right offering for each of these segments, so every customer can find something meaningful regardless of market conditions.”