DGCX sets same-day benchmark for gold trading

Dubai’s commodities market is preparing to launch a same-day physically settled gold contract, giving bullion dealers, refineries and institutional traders a regulated route to execute, clear and settle physical gold transactions within a single trading day.

The Dubai Gold and Commodities Exchange will introduce its Gold Spot T+0 Contract on Monday, 22 June, positioning the emirate as one of the few global centres offering exchange-based same-day settlement for physical bullion. The product is being presented as the GCC’s first regulated spot gold contract with T+0 settlement, a structure intended to reduce operational delays that remain common in over-the-counter bullion trading.

The contract is based on 1kg UAE Good Delivery gold and will be settled in UAE dirhams. Trades will be cleared through Dubai Commodities Clearing Corporation, the exchange’s clearing arm, while physical delivery will be routed through approved vault infrastructure. The model brings execution, central counterparty clearing and delivery into a single regulated framework, offering traders a more transparent alternative to bilateral settlement arrangements.

The launch comes as Dubai seeks to deepen its role in the international bullion trade, linking producers, refiners, banks, wholesalers and jewellery markets across Asia, Africa and Europe. The UAE has become one of the world’s largest physical gold trading hubs, supported by refining capacity, vaulting infrastructure, low-tax bullion trading, air connectivity and a large wholesale market centred on Dubai.

The new contract addresses three specific demands from market participants: faster settlement, greater price certainty and reduced operational friction. Same-day settlement allows participants to deploy capital more efficiently by shortening the time between trade execution and delivery. It can also reduce exposure to counterparty and price movement risks during the settlement window, particularly during periods of high volatility.

Ahmed Bin Sulayem, chairman and chief executive of DGCX, said Dubai’s gold market required faster and more transparent settlement tools as bullion flows expanded between East and West. “By bringing exchange trading, central clearing, and same-day physical settlement together within a regulated framework, we are providing market participants with greater certainty, improved efficiency, and direct access to physical delivery,” he said.

The contract is aimed at bullion dealers, refineries, brokers, clearing members and institutional participants rather than casual retail buyers. Its design gives physical traders a mechanism to match exchange-level price discovery with actual delivery, a feature that is particularly relevant for firms managing refinery output, wholesale inventory, hedging requirements or short-term liquidity needs.

DGCX said the product strengthens Dubai’s market infrastructure by creating a more robust benchmark for physical gold in the UAE. That objective has gained importance as global bullion trading becomes more sensitive to settlement speed, vault location and regulatory oversight. Exchanges and financial centres in Asia and the Middle East are competing to capture more physical gold flows as demand patterns shift eastward.

Gold markets have been shaped by strong investment demand, central bank buying and persistent geopolitical uncertainty. Global gold demand crossed 5,000 tonnes in 2025 for the first time, while gold-backed exchange-traded funds and bar-and-coin purchases rose sharply. Central banks remained large buyers, although the pace moderated from the exceptional levels recorded over the previous three years.

High prices have altered behaviour across the industry. Investment demand has strengthened, but jewellery consumption in several major markets has faced pressure as buyers adjust to elevated prices. For trade hubs such as Dubai, the changing mix of demand has increased the need for efficient wholesale, vaulting and settlement systems that can serve both physical and financial market participants.

The UAE’s foreign trade in precious metals reached nearly AED625 billion in 2024, up 27 per cent from the previous year, underlining the scale of the market that Dubai is attempting to serve with deeper exchange infrastructure. Gold passing through the UAE market has also supported a wider ecosystem of refiners, logistics providers, vault operators, brokers, banks and jewellery wholesalers.

DGCX has been expanding its precious metals suite as part of a broader effort to reinforce its role in regulated commodity trading. Its market activity grew in 2025, with total traded volumes rising 30 per cent year-on-year to 2,048,556 lots. The total value of contracts traded reached $46.96 billion, while average daily volumes rose to 7,940 lots and average open interest stood at 13,015 lots.

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