The price of this product increased by 17% in Qatar
Gold prices in local market touched three-month high, starting the new on firm note. A gramme of 22 carat gold was trading yesterday at QR152.50, a level last seen in the mid of September last year. The yellow metal finished 2017 with a bullish trend as its prices jumped around 15 percent last year.
The 22 carat gold was trading at QR132 on January 1, 2017 while it ended the year at QR151, registering a rise of around QR20.
The sharp rise in the gold prices in the local market was driven by international factor. Prices of yellow metal in Qatar move in tandem with its global prices because prices of gold here are linked to international market, mainly the London bullion market.
Weakness in the value of US dollar and tensions between countries and high inflation in most of the major economies pulled up the prices of gold.
“Prices of gold in local market follow international prices and weakness in the value of US currency was the main reason for jump in gold prices. There were cycles of up and down for gold last year but on the whole it became costlier in 2017,” Santhosh T V, Regional Head, Malabar Gold International told The Peninsula. “We witnessed good demand in the first half of the last year,” he added.
Rising prices of gold could not dent the customers love for the yellow metal as most of the gold retailers witnessed brisk business last year.
“Our business grew by 10 percent in 2017 compared to the previous year, despite rising trend in the prices. We expect to witness growth in this year as well. We are planning to open new branch in Mall of Qatar this month and will continue our expansion throughout the year,” added Santhosh.
Gold retailers said that there was no impact on the supply of gold in the country due to illegal siege imposed on the country since June 5 last year. Most of the gold in the country before siege was coming from the UAE but supply remained uninterrupted as retailers found alternate market such as Oman, India and Malaysia to import gold.
Going forward in 2018, Gold will depend on the movement in the value of dollar and interest rates in the US. A weaker dollar fuels demand for gold by making it cheaper for holders of other currencies, while lower bond yields reduce the opportunity cost of owning non-yielding bullion.
Gold is highly sensitive to rising interest rates because they push up bond yields and tend to boost the dollar.