The volume of gold futures traded on Dubai’s commodities exchange rose 14.8 per cent in November from the previous month as investors returned to the market after Ramadan, the bourse said Monday.
The Dubai Gold and Commodities Exchange (DGCX) said it traded 76,631 gold futures contracts worth $1.99 billion (Dh7.3bn) in November, up from 66,722 contracts the previous month.
“Fundamentally there was more trading interest… October did see the effects of Ramadan and Eid Al Fitr,” the statement said. “Many investors were away during this period.”
Gold, seen by investors as a safe asset, hit a 28-year high of $845.40 an ounce in November. The precious metal often moves in the opposite direction to the dollar as a weaker US currency makes the dollar-denominated metal cheaper for holders of other currencies. “Investment demand has seen a massive surge especially after the $700-levels were comfortably breached,” said Pradeep Unni, assistant vice-president of Vision Commodities Services, DMCC.
“The natural propensity to hold gold in this part of the world has caught momentum over past two months,” he said.
Dubai launched the region’s first gold futures exchange in 2005 as the economies of the Gulf nations boomed on windfall oil income.
Total open interest for gold as of November 30 stood at 1,434 contracts valued at $36.27m (Dh133m), down from 2,928 contracts on October 31, the bourse said. Dubai is a long-established market for gold bullion and both wholesale and retail jewellery. Trade has benefited from strong demand from the Arab world and proximity to India, the main gold market.
The average number of gold contracts traded per day stood at 3,843 in November, a rise of 32.47 per cent from October, the exchange said. Total volume of gold futures contracts traded since its launch on November 22, 2005, stood at around 1.16 million contracts worth $24.48bn (Dh89bn), it said. (Reuters)