Record gold prices aid Dubai trade

Record gold prices are said to be behind an upsurge in scrap gold coming into the Dubai market, according to industry sources.

Spot gold has surged past the $760 per ounce barrier on the New York Mercantile Exchange over the last few days, with the rise producing echoes across the full extent of the gold trade.

Moaz Barakat, World Gold Council (WGC) managing director for the Middle East, Turkey and Pakistan, highlighted the positive effects of the rise for the exchange of scrap gold on the important Dubai market.

"Since gold prices rose by end of September, we have seen an increasing amount of scrap gold in the market.

"Unlike 2006 in Saudi Arabia, the market here looks healthy and we are seeing a significant amount being exchanged between Dubai and countries like Saudi and Egypt," Mr Barakat added.

Sources high up in the Dubai scrap gold industry are reported to have claimed that gold prices have halted the stockpiling of scrap gold that saw supply plunge by 80 per cent earlier in the year, with jewelers and others now profiting from sales.