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Higher interest rates, wedding season push demand for gold

Gold market
(File photo: Jordan News)
AMMAN — Local demand for gold increased noticeably in the past weeks, and it is expected to continue to spike further, according to the head of the Jordanian Jewelers Syndicate, Ribhe Allan. اضافة اعلان

Allan attributed the local market increase in demand for gold to several factors, including the global decrease in gold prices, due to the higher dollar interest rates, and to the arrival of the wedding season, which usually follows Ramadan, and which, these days, sees an a rise in celebrations previously often postponed because of the pandemic.
Gold prices have decreased internationally from $2,000 per ounce to $1,808 per ounce.
Furthermore, Allan said that the ease with which merchants can cash out on gold encourages them to further invest in it, unlike investing in stocks.

Gold prices have decreased internationally from $2,000 per ounce to $1,808 per ounce.

Allan expects gold prices will be stable “unless events in Ukraine impact the global market”, and encourages citizens “to purchase gold, which is a safe investment”.

Economic analyst Mazen Irsheid told Jordan News that the global gold prices are affected by the interest rate on the dollar, adding that normally “it is more feasible and tempting for people to deposit their money in dollars or purchase treasury bills, which, unlike gold, provide a stable and continuous revenue”.

This being the case, “gold prices can be expected to fall globally”, and local demand for it to climb further”, Irsheid said.

He added that conflicts like the Russian-Ukrainian war caused gold prices to rise and reach $2,000 per ounce, but “now people have forgotten about the war and will likely purchase more gold”.

Economic and Investment Specialist Wajdi Makhamreh told Jordan News that when people witness international financial hardships, and inflation grows, they “prefer to put their money in safe assets”. Gold, he said, is one of the safest investments because it does not depreciate even when there is inflation.

Like Allan, he believes that that many Jordanians will celebrate weddings and other occasions, which is bound to see demand for gold grow.

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