• The Middle Eastern jewellery market is currently experiencing significant disruption due to escalating regional conflict, particularly involving the United States, Israel, and Iran. While physical shops in major hubs like Dubai remain open, retail and wholesale trade have slowed drastically.

Market Impact & Trade Disruptions

Dubai Retail Slump: Retail jewellery sales in Dubai have plummeted to 10–15% of normal levels as of March 2026. This is largely due to an 80–90% decline in tourist footfall, which typically drives the majority of the market. 

Logistical Halts: Flight cancellations and airspace closures have brought diamond and bullion trade to a near standstill. Dubai, a critical global hub, has seen jewellery exports drop by 80–90%.

India-UAE Trade Shock: India, which relies on the UAE for over two-thirds of its rough diamond imports, is facing a severe supply shortage. Exports of finished jewellery from India to the Middle East have also been halted.

Bullion vs. Jewellery: While jewellery sales are suffering, bullion trade remains relatively more stable, as investors seek gold as a “safe-haven” asset during the conflict.

Price Volatility

Sharp Correction: After peaking in early March 2026, gold prices in the UAE saw a dramatic drop of over Dh50 per gram by March 20, 2026.

Buying Window: This price dip, falling just before Eid ul Fitr, has triggered a sudden rush of local shoppers in Dubai’s gold souks, despite the broader geopolitical uncertainty.

Global Trends: Spot gold hit more than a one-month low recently, trading around $4,675 per ounce due to a strong U.S. dollar and Federal Reserve policy expectations.

Corporate & Regional Developments

Strategic Shifts: Companies like Renaissance Global are still expanding their presence with new subsidiaries in Dubai to leverage long-term growth prospects.

Investment Interests: Kalyan Jewellers is reportedly in talks with Middle Eastern investors for franchise-led expansions. 
New Divisions: Luxury conglomerate Kering has restructured its jewellery business, creating a specialised division to accelerate its brand portfolio.