Dubai: The Brexit vote is casting its influence over the UAE’s jewellery business as well. Retailers are hopeful that concerns over a speedy gold price spike will propel local shoppers to the stores this weekend before the increase becomes more pronounced.

“In early trading on Friday, gold had gone past $1,350 an ounce, momentarily, in the Asian markets,” said Cyriac Varghese, General Manager at Sky Jewellery and who oversees bullion buying operations at the retailer. “The average seems to be at the 1,325 mark… and with further upward mobility.

“I have already sent out messages to our individual stores to be prepared for a middling-to-heavy rush in buying from local shoppers for Friday.”

As such, gold has already recovered by a near 30 per cent in the year-to-date.

Other retailers Gulf News spoke to are also hoping for a Friday rush to pan out and compensate for lackluster buying for the better part of the last two weeks.

Retailers are pulling out all stops to get shoppers interested. Apart from the usual raffles, some have offers spiced with “zero making charges”, “guaranteed buybacks”, etc. And even Audis if your name ends up on the winners’ tickets.

There are other changes retailers are bringing in, though these relate more to internal adjustments than anything customer-facing. Some are now shifting from keeping an “open position” on their bullion buying to hedging now that trends point to gold to maintain its upward path.

“Gold is only going to go up… a hedged position is the best way to manage our inventory needs during this period of likely volatility on the upside,” said a wholesaler.

A $1,350 plus level could well be the new normal for gold in the near-term, more so as the US Federal Reserve is unlikely to move towards a further rate hike immediately. Investors’ rush towards the metal’s safe haven status will only be reinforced if the dollar more or less remains at current levels.

In the last two weeks, local shoppers have been keeping to the sidelines in keeping with the divergent views on how the UK referendum vote will pan out. At the close of trading on Friday last (June 17), gold was quoted at $1,299 an ounce. All through that week, the impression had been gaining ground that the Brexiters were gaining control in the debate.

Then, during this week, it slipped to $1,263 as sentiments seemed to coalesce around the “No” vote belatedly picking up momentum after the murder of the UK member of parliament Jo Cox.

“Even on Thursday (June 23 and the day of the referendum), the mood was bullish that the UK will remain in the EU,” said a retailer. “In that scenario, gold would still have had an upward movement, but the range would have remained in the $1,200-$1,250 an ounce range than the $1,350 we will start seeing more of.

“It’s too steep a climb for UAE – and global – gold consumers. Summer will have less of a sparkle in this situation.”