The recent violent volatility in gold prices is disrupting traditional buying patterns in Dubai with customers moving from jewellery to bullion as they renew a focus on the yellow metal's investment potential, a trend that is prompting more city jewellers to stock gold in the form of coins and bars.

Dubai, known as the city of gold, is a long-established market for bullion and wholesale and retail jewellery. Its trade is fuelled by demand from India, the world's number one gold consumer, and domestic consumption which, at 19 tons in the second quarter of 2011, makes the United Arab Emirates the second-largest consumer of gold jewellery and bullion in the Middle East after Saudi Arabia.