The Middle East is quickly gaining popularity as one of the world’s major gold markets. According to Bloomberg, the Middle East will handle a large chunk of trades due to the increase in gold’s local demand. This is mainly because buyers from other nearby countries flock to diversify their investments in gold.
Gold’s inherent value as a diversifying instrument has always attracted investors. According to an estimate the gold trade in Dubai is so important that almost 40% of all global gold passed through this territory. Although the Middle East’s own gold consumption has been fluctuating, it is recognized as an important center for gold trade. Many Bullion traders think that the Middle East has a lot of potential in becoming one of the major players in gold trade.
Dubai’s Gold Souk is one of the biggest markets for gold trade located in the heart of the city’s commercial center. Not surprisingly, India, a major consumer of gold, is one the largest buyers of gold at Dubai’s international market. Dubai’s rapidly expanding gold can be further flourished if it focuses on China. China is the world’s largest buyer of gold. Chinese consumers prefer to buy gold ounces or bars. With Dubai’s excellent gold refining capabilities the Chinese market will hardly be a challenge for the Middle East’s traders.
With more than USD 18 trillion of gold traded in 2014, the global demand for the precious metal has been steadily increasing over the years due to a large fall in prices. The UAE and the rest of the Middle Eastern countries in general will grow as a global hub for trading gold. This may be mainly due its strategic position near the largest gold consuming nations.
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