Demand in the UAE received a small boost in December as consumers rushed to make their purchases before VAT in January.
Gold jewellery demand in the UAE fell for the fourth consecutive year in 2017, falling two per cent to a 20-year low, according to World Gold Council data.
"Demand in the UAE received a small boost in December as consumers rushed to make their purchases before a five per cent Value-Added-Tax (VAT) was imposed in January. But the 16 per cent year-on-year gain in Q4 demand failed to rescue the market from a fourth consecutive annual decline: 2017 demand was down two per cent to a 20-year low of 42.8 tonnes," the Council said.
Globally, gold demand rallied in the closing months of 2017, gaining six per cent year-on-year to 1,095.8 tonnes in Q4. But it was too little, too late as full year demand fell by seven per cent to 4,071.7 tonnes.
According to World Gold Council, full-year gold jewellery demand increased by 4% to 2,135.5 tonnes - the first year of growth since 2013.
India and China led a four per cent recovery in jewellery, although demand remains below historical averages. Increased use of gold in smartphones and vehicles sparked the first year of growth in technology demand since 2010.
India's 12 per cent year-on-year improvement was partly due to a very weak 2016. Demand fluctuated on changes in tax and regulation.