The UAE gold jewellery demand fell 28 per cent year-on-year to 5.6 tonnes in the second quarter of 2026 compared to 7.7 tonnes during the same period last year due to the impact of regional geopolitical tension and lesser demand from the tourists, according to World Gold Council data.
However, gold jewellery demand rose 21.7 per cent quarter-on-quarter in the UAE, as record high prices during January took a toll on precious metal jewellery.
The precious metal’s all-time high stands at $5,589.38 per ounce, reached on January 28, 2026. That day saw gold jump more than $300 during the trading session, driven largely by escalating tension between the US and Iran, as the US threatened a major strike on the country.
But gold bars and coins bucked the trend, as demand shot up 30 per cent year-on-year to 5.3 tonnes during second quarter of 2026, up from 4.1 per cent during same period last year. Quarter-on-quarter demand for gold coins and bars in UAE jumped 32.5 per cent, according to World Gold Council data.
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Gold coins and bars remain a favoured investment choice in the UAE for a mix of cultural and financial reasons. For South Asian, Arab, and other expatriate communities, gold has long been viewed as a store of value passed down through generations, tied closely to weddings, festivals, and family savings traditions.
On the financial side, gold coins and bars are seen as a hedge against inflation and currency volatility, particularly during periods of geopolitical uncertainty or stock market swings. Many residents prefer physical gold over paper-based investments like ETFs because it offers direct ownership, portability, and liquidity. It can be resold or used as collateral relatively easily.
The precious metal price has been trending lower after the start of the Middle East war as rising oil prices have brought inflation concern in the US economy.
On Monday evening, spot gold was trading at $4,026 per ounce, down 1.24 per cent. In the UAE, 24K and 22K gold prices were trading at Dh488.25 and Dh452.0 per gram at the opening of the market.
Simon-Peter Massabni, head of business development at xs.com, said on the fundamental side, gold’s outlook will remain closely tied to the path of inflation, US monetary policy, the direction of the dollar, and real bond yields.
Massabni believes that outlook remains tilted toward a continuation of gold’s bullish trend over the medium and long term, although he expect strong corrective waves along the way.
“I do not believe new all-time highs should be ruled out if the current supportive fundamentals remain in place. In fact, I believe the greater risk for investors may be underestimating the strength of the broader uptrend because of short-term corrections. At the same time, I see little justification for chasing gold higher at every rally. The better approach is to wait for areas of consolidation and re-entry while using technical levels to define potential opportunities and manage risk effectively,” he said.
Massabni says gold is entering a pivotal phase that could shape the market’s trajectory over the coming years.
“If the current move proves to be merely a correction within a longer-term bull market, today’s prices could eventually be viewed as a period of accumulation before another major advance. However, if gold successfully breaks through its key resistance levels and establishes sustained trading above previous highs, we could witness a transition from a rally driven primarily by fear and hedging into a new phase characterised by a global repricing of gold itself.
“For that reason, I do not view gold as a story that has ended after the latest correction. Instead, I see it as an asset that still possesses strong structural drivers for further gains, with disciplined risk management and confirmation of technical signals remaining the most important factors when navigating the next stage of the market, he added.
