Iran’s demand for gold tripled in the second quarter, reaching a four-year high, ahead of this month’s US renewal of sanctions that has prompted the rial to shed more than half of its value this year.
Sales of gold bars and coins surged 200 per cent to 15.2 tonnes in the second quarter of 2018, the World Gold Council said in a report on Thursday. Analysts say demand could continue to grow during the rest of the year as the US sanctions come into effect over the coming months, putting further pressure on the currency.
“Iran’s weakening economy, growing sense of insecurity and a currency which has almost halved in value, boosted bar and coin demand,”
the report said.
Iranians are hoarding gold bars and coins as their economy, battered by years of sanctions, may weaken further when the US imposes an embargo on Iran's energy, finance, shipping and insurance sectors on November 4.
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Global demand for gold bar and coins in the second quarter was flat year-on-year at 247.6 tonnes but investor concerns on currency depreciation drove demand in the Iranian market, the report said. The Iranian rial had slumped over the three months, prompting the rush for gold investments, which are considered a safe haven amid economic volatility.
The rial dropped to an all-time low this weak but recovered on Wednesday after US president Donald Trump offered to talk with his Iranian counterpart, Hassan Rouhani.
“Looking at the performance of the Iranian rial over the course of 2018 it’s only natural that gold demand has Iranian consumers and manufacturers look to protect against further devaluation in the lead-up to August 6,” said Gaurav Kashyap, market
strategist at Equiti Global Markets. “With the geopolitical situation in the region and political uncertainty domestically, consumers will continue to flock to gold as a safe haven.”
The drop in the rial will "continue to spark Iranian demand going forward," he added.
Demand for gold jewellery in the Middle East in the second quarter continued to struggle against a "challenging" economic backdrop, the report said.
Iran led the regional gold jewellry drop with the biggest loss in the second quarter as Iranian demand fell 35 per cent to 6.6 tons, the lowest quarter in the council's data records.
"Faced with renewed economic sanctions and a collapsing currency, which caused a huge rise in the local price, demand for gold jewellery slumped," the gold council said. "Instead demand was channelled into gold investment products which, unlike gold jewellery, are VAT-exempt, pushing demand for bars and coins to a four-year high. "
THREE POSSIBLE REPLACEMENTS
Khalfan Mubarak
The Al Jazira playmaker has for some time been tipped for stardom within UAE football, with Quique Sanchez Flores, his former manager at Al Ahli, once labelling him a “genius”. He was only 17. Now 23, Mubarak has developed into a crafty supplier of chances, evidenced by his seven assists in six league matches this season. Still to display his class at international level, though.
Rayan Yaslam
The Al Ain attacking midfielder has become a regular starter for his club in the past 15 months. Yaslam, 23, is a tidy and intelligent player, technically proficient with an eye for opening up defences. Developed while alongside Abdulrahman in the Al Ain first-team and has progressed well since manager Zoran Mamic’s arrival. However, made his UAE debut only last December.
Ismail Matar
The Al Wahda forward is revered by teammates and a key contributor to the squad. At 35, his best days are behind him, but Matar is incredibly experienced and an example to his colleagues. His ability to cope with tournament football is a concern, though, despite Matar beginning the season well. Not a like-for-like replacement, although the system could be adjusted to suit.
Tour de France 2017: Stage 5
Vittel - La Planche de Belles Filles, 160.5km
It is a shorter stage, but one that will lead to a brutal uphill finish. This is the third visit in six editions since it was introduced to the race in 2012. Reigning champion Chris Froome won that race.
The flights: South African Airways flies from Dubai International Airport with a stop in Johannesburg, with prices starting from around Dh4,000 return. Emirates can get you there with a stop in Lusaka from around Dh4,600 return.
The details: Visas are available for 247 Zambian kwacha or US$20 (Dh73) per person on arrival at Livingstone Airport. Single entry into Victoria Falls for international visitors costs 371 kwacha or $30 (Dh110). Microlight flights are available through Batoka Sky, with 15-minute flights costing 2,265 kwacha (Dh680).
Accommodation: The Royal Livingstone Victoria Falls Hotel by Anantara is an ideal place to stay, within walking distance of the falls and right on the Zambezi River. Rooms here start from 6,635 kwacha (Dh2,398) per night, including breakfast, taxes and Wi-Fi. Water arrivals cost from 587 kwacha (Dh212) per person.
RESULTS FOR STAGE 4
Stage 4 Dubai to Hatta, 197 km, Road race.
Overall leader Primoz Roglic SLO (Team Jumbo - Visma)
Stage winners: 1. Caleb Ewan AUS (Lotto - Soudal) 2. Matteo Moschetti ITA (Trek - Segafredo) 3. Primoz Roglic SLO (Team Jumbo - Visma)
'Young girls thinking of big ideas'
Words come easy for aspiring writer Afra Al Muhairb. The business side of books, on the other hand, is entirely foreign to the 16-year-old Emirati. So, she followed her father’s advice and enroled in the Abu Dhabi Education Council’s summer entrepreneurship course at Abu Dhabi University hoping to pick up a few new skills.
“Most of us have this dream of opening a business,” said Afra, referring to her peers are “young girls thinking of big ideas.”
In the three-week class, pupils are challenged to come up with a business and develop an operational and marketing plan to support their idea. But, the learning goes far beyond sales and branding, said teacher Sonia Elhaj.
“It’s not only about starting up a business, it’s all the meta skills that goes with it -- building self confidence, communication,” said Ms Elhaj. “It’s a way to coach them and to harness ideas and to allow them to be creative. They are really hungry to do this and be heard. They are so happy to be actually doing something, to be engaged in creating something new, not only sitting and listening and getting new information and new knowledge. Now they are applying that knowledge.”
Afra’s team decided to focus their business idea on a restaurant modelled after the Leaning Tower of Pisa. Each level would have a different international cuisine and all the meat would be halal. The pupils thought of this after discussing a common problem they face when travelling abroad.
“Sometimes we find the struggle of finding halal food, so we just eat fish and cheese, so it’s hard for us to spend 20 days with fish and cheese,” said Afra. “So we made this tower so every person who comes – from Africa, from America – they will find the right food to eat.”
rpennington@thenational.ae
