Sharjah, 5 Apr 2011 (WAM) -- A decline in gold prices from record highs is set to bring in more buyers to the MidEast Watch and Jewellery Show that got under way at Expo Centre Sharjah on Tuesday, April 5, 2011. The show was inaugurated by H.H. Sheikh Sultan Bin Mohammed Bin Sultan Al Qassimi, Crown Prince and Deputy Ruler of Sharjah.

According to a straw poll of exhibitors taking part in the landmark 30th edition of the show, rising inflation due to high oil prices and a decline in confidence in the US dollar will also be key drivers that encourage people to store their wealth in gold.

Gold futures for June delivery dropped US$ 11, or 0.8%, to settle at $1,428.90 an ounce on April 1, 2011, the biggest drop since March 15.

Gold had climbed to a record of $1,448.60. The precious metal has advanced 27% in the past 12 months. Some analysts are expecting gold to touch an average price of $1,500 for 2011 and $1300 next year.

The opening ceremony of the show was attended by Mr. Ahmed Mohammed Al Midfa, Chairman of the Sharjah Chamber of Commerce & Industry (SCCI), Mr. Saif Mohammed Al Midfa, Director-General of Expo Centre Sharjah, officials of various government departments, and members of trade associations. The show will conclude on Saturday, April 9, 2011.

"The appeal of gold in relation to other asset classes is continuing to rise. The World Gold Council report for 2010 showed an increase in global demand for gold, which stood at a 10-year high last year. The UAE too saw a massive jump in demand as investors zeroed in on the yellow metal expecting a continued upward trend in its price," said Mr. Ahmed Mohammed Al Midfa.

Gold demand in 2010 reached a 10-year high with annual demand of 3,812.2 tonnes worth about $150bn, according to World Gold Council. In the UAE, jewellery worth $2.471bn weighing 63.4 tonnes was bought last year.

"It is no wonder that gold topped the trade in the UAE last year. Gold demand in the country also saw a massive rise in the first quarter of this year. These are positive tidings for the regional industry that will result in better turnout of buyers and rise in sales at the MidEast Watch and Jewellery Show," added Mr. Ahmed Mohammed Al Midfa.

The preliminary statistical data of UAE Federal Customs Authority for 2010 until November showed that gold stood at the first position among country's imports, with a value of $1.46bn. It was followed by diamond with $788m.

Gold also took the first spot on the exports list with a value of $815m. In re-exports, diamond came first with a total value $1.08bn, followed by ornaments and jewellery and related parts ($271m).

"People who were hesitant in buying gold and diamond jewellery during the financial crisis are now back in the market. Besides, improved consumer confidence and rising purchasing power are encouraging people to buy gold. Greater acceptance of higher gold prices and rise in tourist arrivals from countries like India that are culturally inclined towards the precious metal are also boosting sales," said Mr. Saif Mohammed Al Midfa.

The MidEast Watch & Jewellery Show has brought together more than 450 master jewellers and jewellery houses from all over the world at nearly 16,000 square metres of exhibition space. Exhibitors have come from Armenia, Italy, Bahrain, China, Lebanon, Qatar, India, Jordan, Japan, Lithuania, Myanmar, Saudi Arabia, Singapore, Thailand, Turkey, Malaysia, the US and the UAE.

"The show is also celebrating a major milestone... it is the 30th edition of the MidEast Watch and Jewellery Show. It is now one of the longest running and most popular jewellery fair that is held twice a year. This is a proud moment for all of us at Expo Centre Sharjah," said Mr. Saif Mohammed Al Midfa.

Copyright Emirates News Agency (WAM) 2011.