Jewellers in Jordan pin hope on COVID-19 vaccination for surge in gold demand

AMMAN — The local demand for gold has been very weak lately despite the significant drop in price, according to sector representatives.

There has been a noticeable decrease in gold prices, in some cases up to $100 drop in a single day going from $1,940 to $1,864 per ounce, due to global political developments, mainly the unrest in the US, and the COVID-19’s economic fallout.

Local traders said that they are pinning hopes on the COVID-19 vaccination for stability in gold prices.

Locally, restrictive measures taken to combat the pandemic such as the closure of wedding halls, and limiting weddings and gatherings have lead to a decline in local demand for gold, they added.

The jewellery sector has incurred losses of around JD100 million since the onset of the pandemic crisis, according to the representatives.

“The reasons for the drop in gold prices are the rise in the value of bitcoin, which encouraged investors to buy the cryptocurrency, in addition to the statement by US President Donald Trump promising a peaceful transition of power,” Rebhi Allan, secretary of the Jordanian Jewellers Syndicate, told The Jordan Times.

Abdullah Al Hroob, a jeweller in Amman, said that the COVID-19 pandemic has affected gold prices locally and internationally.

“Gold is considered a safe haven in all kinds of crises, that is why people tended to buy gold to preserve their money during the pandemic, and countries stored gold instead of currency,” Hroob said.

Khalil Msharbash, another jewellery owner in Amman, attributed the fall in demand for gold to pandemic-induced closures and travel restrictions.

“The supply and demand for gold is very weak locally like in all other sectors. The volume of trading has decreased by no less 65 per cent,” Msharbash said.