High gold prices weighed on Dubai's gold sales in October, depressing their value by six per cent from a year earlier, a top industry executive said.

'The market did not look good last month. We had earlier expected a 30 per cent rise in gold sales value, but sales actually dropped 6 percent compared to October last year,' Tawhid Abdullah, managing director of the Dubai Gold and Jewellery Group, said.

'But compared to other markets in the region, a 6 percent fall is not too bad,' he said.

Gold jumped above $800 per ounce for the first time since 1980 on Friday, boosted by surging oil prices, a record low dollar and more fallout from the global credit market crisis.

Dealers said given current fundamentals, the next big resistance level was $850, a record hit in January 1980.

Dubai, known as the City of Gold, saw the value of gold sales in the third quarter rise 26 per cent from a year earlier, Abdullah said.

Dubai is a long-established market for gold bullion and wholesale and retail jewellery, fuelled by strong demand from the Arab world and India, the world's main gold market.

In the UAE capital Abu Dhabi, a much smaller market than Dubai, gold sale volumes dropped by 15 per cent in October, while the sales value rose 10 per cent on high prices, the emirate's Gold and Jewellery Group chief said.

'Ramadan helped the sales at the beginning of October, but then sales dropped sharply with the recent price hikes,' Abdullah said.

Tax-free jewellery in the UAE’s gold souks and shopping malls draws GCC and Western tourists.

Some local traders feared gold sales volume in the UAE could fall by about 10 per cent in 2007, as they did in the previous year due to high prices.

High gold prices have led to an increase in the flow of scrap gold onto the market in Dubai in recent weeks. Reuters