Saudi Gold Market Poised to Outshine Regional Peers: World Gold Council

The World Gold Council predicts Saudi Arabia's gold market will outshine its regional peers in the coming months. According to Andrew Naylor, head of Middle East and public policy at the council, this is due to a growing shift toward investment demand, making it less vulnerable than neighboring markets that rely more heavily on tourism.

Naylor notes that Saudi Arabia's gold market is benefiting from strong domestic consumption, while the UAE, for example, is more of a tourist-driven consumption market. Although jewelry demand has softened across the region because of historically high gold prices, Saudi Arabia recorded the smallest decline among Middle Eastern markets covered by the council.

Saudi Arabia also recorded robust bar and coin investment demand, with demand rising 23 percent year on year, while the UAE posted a 30 percent increase. Naylor says investor demand is increasingly becoming the dominant driver of gold consumption, while jewelry purchases have become more sensitive to elevated prices.