LONDON - Dubai's commodities exchange will launch a same-day settlement gold contract on Monday, its CEO told Reuters, aiming to tap safe-haven demand and faster trading infrastructure to boost liquidity in the emirate's bullion market.

The Dubai Gold and Commodities Exchange (DGCX), part of the Dubai Multi Commodities Centre (DMCC), said shorter settlement cycles reflect broader market shifts toward speed and efficiency.

The Gold Spot T+0 Contract has been developed for bullion dealers, refineries, brokers, clearing members and institutional market participants, offering improved price certainty and physical delivery through approved vaults.

"More than 10 years ago, T+1, T+2 were big deals, but now the whole exchange market is talking about faster settlements and better technologies," DMCC CE Ahmed Bin Sulayem said in an interview.

The launch comes as geopolitical tensions, including the US-Iran conflict, lift gold trading volumes, with investors seeking refuge in the metal. Although prices have retreated from record highs, widening fiscal deficits and sustained central-bank buying continue to support gold's longer-term investment case.

"We've noticed the first two, three weeks of the war, gold contract volumes increased on DGCX," Bin Sulayem said. "Because it's a given that tourism [and] property will be affected, but not trade. As long as the airports are working, traders are there."

GOLD HUB AMBITIONS

Financial markets globally have been shifting toward shorter settlement cycles, as exchanges and clearing houses upgrade systems and adopt new technologies to reduce counterparty risk and free up capital more quickly.

A T+0 contract would allow refiners, traders and jewellers to hedge and settle positions immediately, an option still limited in global gold derivatives markets.

"It would serve the gold market, give them a better alternative than what they have today," Bin Sulayem said.

Dubai has long positioned itself as a global trading hub linking gold flows between Africa, Asia and Europe, supported by its logistics infrastructure, tax framework and proximity to major consumer markets such as India.

PIPELINE

The gold contract is part of a broader pipeline of products being considered by the exchange, including new currency pairs and digital assets.

"We're looking at crypto derivatives, but not in the short term. It could be medium or long term," he said. "The yuan-dollar is likely the newest currency we're looking to list."

He added that historical currency products on the exchange have typically been linked to major commodity producers or trading hubs.