October 29, 2006	Sunday	Shawwal 5, 1427

DUBAI, Oct 28: Dubai's gold imports fell 9 per cent in the third quarter to 117.6 tons against the same period last year as gold prices soared, the Dubai Gold and Commodities Exchange said.

Dubai is a leading centre for the import and re-export of gold, bringing in 521,765 kg (1.150 million lbs) of gold in 2005 and exporting 223,303 kg, the Dubai Metals and Commodities Centre (DMCC) said.

"The reduction of imports is because of the higher prices of gold and what is happening is that Dubai is now a refining centre as well so it is getting the two-way flows of business," Colin Griffith, a senior DMCC official and head of DGCX, said.

"What is lost on the retail side is picking up on the refining business. So the total volume of business going through Dubai is higher than last year," he said.

Dubai's gold exports rose 30.6 per cent in the third quarter to 52.7 tons against the same period last year.

Dubai is part of the United Arab Emirates, one of the world's top gold-consuming countries, and is a major hub of the physical gold trade in the Middle East and Asia.

Officials at the DMCC expect Dubai's gold imports to fall slightly in the second half of this year on lower consumption.

Griffith said while consumption has gone down, the actual volume trade has gone up because “you get other businesses coming in”, and Dubai, particularly has become a very important centre for refining of scrap gold.

Scrap supply had risen and physical buyers would step up gold purchases after prices stabilised.

Gold, which rallied in the first half of this year, rising above $700 an ounce, traded near $600 an ounce on Friday, lifted by the weakest US GDP growth data in three years and an alert at a major Saudi oil terminal.

Bullion has recently traded broadly between $570 and $605.

Gold is seen as a safe-haven metal and as a hedge against inflation. The metal is also influenced by oil, currency moves, and generally trades in the opposite direction of the dollar.—Reuters